Abstract:
Purpose: The research investigates the effect of foreign direct investment on economic
growth in SAARC countries. Multiple regression models are used to analysis the
relationship of FDI and GDP. From 2001 to 2013 used this time period data to identify the
level of significance .Correlation and regression analysis were used to explore the
relationship between them.
Methodology: The relationship between the foreign direct investments and gross domestic
product identify level of significance with the help of linear regression model. In this model
GDP is dependent variable and FDI is independent variable
Findings: The results show, the overall model significant with affirmative and the effect of
FDI on GDP is significant and shows positive relationship between FDI and GDP.
Implications: Two see the effect of foreign direct investment on economics growth of
SAARC countries have a significant influence on decisions of the economist of SAARC
countries. FDI can serve as a way of transfer of knowledge and technology and adds value to
the human capital. FDI accelerate economic growth (GDP) in SAARC countries by
increasing opportunities of employment, aggregate productivity and the outflow of exports.
