Besides fdi, four other variables including debt, trade, inflation and domestic investment have been included in the study, to regress upon gdp of this country the methodology to test the impact of these variables on pakistan's economy has been limited to the least squares method. In this context, this study will examine the impact of fdi on economic growth, domestic investment and export in south asian countries (india, pakistan, bangladesh, sri lanka and nepal. Impact of exchange rate volatility on fdi in pakistan wwwiosrjournalsorg 81 | page economic growth and fdi. Economic growth while inflation negatively affects the fdi and exchange rate positively in case of inflation, the relationship is more significant in developed economies. Where g is the per capita gdp growth rate, fdi is the foreign direct investment, trd is the trade (exports plus imports) of goods and services, hc is the stock of human capital, k is the domestic capital investment, g 0 is the initial gdp (initial stock), irt is the inflation rate, tx is tax on.
Impact of foreign direct investment on trade and economic growth of pakistan: a co-integration analysis arshad, muhammad msc economics, university of copenhagen, denmark. Foreign direct investment and economic growth in turkey he inferred that there is no granger causal relationship between fdi and economic growth by means of a granger causality (gc) test anwar and nguyen (2014)  study focuses on the impact of fdi and fdi-generated spillovers. Significance of fdi, gdp and negative impact of public investment, and role of financial development to decline poverty in pakistan, rise standard of living and to create service occasions for the individuals.
Capital are also important for the eﬀect of fdi on economic growth jel classiﬁcation: f23, f36, f43, o40 keywords: fdi spillovers, backward linkages, ﬁnancial development, economic growth. Nuzhat falki (2009) examined the impact of fdi on economic growth of pakistan she collected the data of fdi from the handbook of pakistan economy-2005 published by the state of pakistan and the world bank development indicators-2008 from 1980 to 2006 with variables of domestic capital, foreign owned capital and labor force. Mainly focuses the region of pakistan because the results regarding the impact of fdi on economic growth in pakistan are different to that of different studies, such as: (falki, 2009 saqib et al, 2013 khan and khan, 2011. Gdp growth rate in pakistan averaged 491 percent from 1952 until 2016, reaching an all time high of 1022 percent in 1954 and a record low of -180 percent in 1952 pakistan is one of the poorest and least developed countries in asia. Pakistan's average economic growth rate in the first five decades (1947-1997) has been higher than the growth rate of the world economy during the same period average annual real gdp growth rates  were 68% in the 1960s, 48% in the 1970s, and 65% in the 1980s.
Economic growth is directly related to inflow of foreign direct investment and it is also statistical significant at 5% level which implies that a good performance of the economy is a positive signal. Investigate the relationship between the foreign direct investment (fdi) and the economic growth of pakistan over the period 1966-2014 fdi plays a key role in the development of developing countries. Pakistan, fdi inflows have no statistically significant impact on economic growth, both in short run and in long run [kakar and khilji, 2011] impact of trade openness, fdi inflows and total exports on economic growth of india: an.
Malik(2015) investigated the study on the impact of fdi on economic growth of pakistan after applied the different techniques durbin watson test, regression analysis, co integration analysis and correlation on the secondary data from 2008 to 2013 and found that foreign direct. The study aims to analyse the impact of foreign direct investment (fdi) on the economic growth of pakistan over the period 1991-2015 the study utilized correlation and multiple regression analysis to determine the impact of fdi on the economic growth of pakistan. This paper revisits the fdi and economic growth relationship by examining the role fdi inflows play in promoting growth in the main economic sectors, namely primary, manufacturing, and services. Variables that we will use in our research are fdi growth rate, gdp growth rate, energy imports, political instability and real exchange rate the following model is proposed for the regression analysis.
Growth rate of real gdp, export orientation, and liberalization, among others, have positive impact on fdi on the other hand, macro economic instability and poor infrastructure have negative impact on fdi. Gdp growth rate, inflation, exchange rate, interest rate on fdi flows into pakistan the findings indicate that gdp growth and interest rate affect fdi flows significantly and inflation rate and exchange rate appear insignificant. Iqbal et al (2010) examined the link between fdi, trade and economic growth in pakistan and the study shows that the two way causal connections exist between economic growth, export and fdi, with unidirectional of import to export and fdi.