Examining the Influence of FDI in Food Processing Industry of India on Domestic Investment Through DOLS

Abstract

Foreign direct investment is considered the primary substitute source of finance for business firms. The level of foreign investment serves as a key indicator of a country's growth potential. The Food processing industry is an unexplored sector that has huge potential to navigate the economic growth of India. The Food processing industry is expected to contribute approx 20% to India's GDP by 2030. Through extensive literature review, it has been found that no study investigates the impact of FDI in the food processing industry of India on domestic investment in the food processing industry. This study establishes a connection between Foreign Direct Investment in the food processing industry and domestic investment in the food processing industry of India. To analyze the time series data from 2003 to 2023, co-integration and Dynamic Ordinary Least Square (DOLS) methods have been employed.