INTERNATIONAL JOURNAL FOR INNOVATIVE RESEARCH IN MULTIDISCIPLINARY FIELD

Abstract:    This study undertaken analyses the relation between FDI (Foreign Direct Investment), economic growth, and openness of trade in context of India using empirical analysis. FDI is considered a key driver of development through capital formation, technology transfer, and employment generation, yet its actual impact on economic growth remains debated. Using secondary time-series data from 2012–2024, the study analyzes FDI inflows trend, GDP growth, and trade openness through the techniques of correlation, ANOVA, and also the methods of regression. The findings indicate that there is a weak but positive relation between FDI and the growth of GDP, which suggests that foreign investment alone does not significantly influence economic expansion. Regression results show that there is an impact of FDI on GDP growth is statistically insignificant, highlighting the role of other macroeconomic and structural factors. Trade openness demonstrates negative and significant relation with FDI inflows, reflecting the complexity of investment dynamics. The analysis of the study concludes that FDI supports economic development, its effectiveness depends on policy stability, infrastructure, institutional quality, and overall economic conditions.

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