A study on impact of foreign investment on technical efficiency of FDI based companies in India

Abstract

Foreign investment play very important role for the economic development of any country. India is being a developing economy, having potential to grow but facing problem of shortage of capital in growing sectors. There are many policies framed by the Government of India in order to attract the foreign investment in form of FDI and FIIs in different routes in the country. Many research studies revealed the fact that there is a significant impact of foreign investment on technological efficiency of India sectors. This paper made an attempt to assess the impact of foreign investment on technological efficiency of sectors like Food and Agriculture Sector, Textile Sector, Pharmaceutical Sector, Construction Sector and Metal Sector in India with the help of the necessary statistical technique such as OLS in the study from 2007 to 2016. The study concluded that all sectors Food and Agriculture Sector, Textile Sector, Pharmaceutical Sector, Construction Sector and Metal Sector in India are shown statistically significant impact of foreign investment on technological efficiency.