Joint Venture Investment, Infrastructural Spillover and Economic Growth : A South Asian Perspective

Asia is the largest recipient of foreign direct investment inflows in the world, which is the 9% of the total FDI inflows of Asia. This research analyzes the multidimensional spillovers from FDI inflows on the economic growth of selected South Asian economies (India, Srilanka, Pakistan and Bangladesh). This study focuses upon the long run relationship between economic growth and joint venture investment foreign direct investment and domestic investment. Further, this research examines the role of infrastructural spillover through FDI on the economic growth. The data for respective variables is taken from World Development Indicators (WDI) for the time period of 1990-2013. The long run relationship is estimated by Mean Group, Dynamic Fixed Effects and Pooled Mean Group panel co-integration test. The results show positive technological spillovers of foreign direct investment through infrastructure and trade openness on the economic growth of South Asian economies