Foreign Portfolio Investment in India: Trends and Determinants

Authors

  • Manowar Hussain The Institute of Cost Accountants of India
  • Bhaskar Goswami The Institute of Cost Accountants of India

DOI:

https://doi.org/10.33516/rb.v47i3-4.71-88p

Keywords:

Foreign Portfolio Investment (FPI), Index of Industrial Production (IIP), Stock Market Capitalization (MC), Autoregressive Distributed lag (ARDL) Model.

Abstract

The present study analyzes the long-run and short-run relationship of foreign portfolio investments (FPI) with other explanatory variables. The study uses monthly data from January 2002 to July 2020. The autoregressive distributed lag (ARDL) technique is used to find the long run co-integration relationship of the model variables. The result obtained from error correction model shows that the model is stable and there by explains the integration of the long-run relationship of FPI with other variables. The results confirm to the fact that in the long run, IIP has a significant positive relationship with FPI inflows while the stock market capitalization has significant negative relationship. However, in the short-run we find that all variables have a significant relationship with FPI. Thus our study can be a guide to investors and the policy makers to predict the pattern of the foreign portfolio investment in India.

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Published

2022-06-17

How to Cite

Hussain, M., & Goswami, B. (2022). Foreign Portfolio Investment in India: Trends and Determinants. Research Bulletin, 47(3-4), 71–88. https://doi.org/10.33516/rb.v47i3-4.71-88p

Issue

Volume 47, Issue 3-4, October 2021-January 2022

Section

Articles
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