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Although it is very common to argue that the foreign direct investment is beneficial for
the economic development of a nation. This exploration investigates the connection
amongst FDI and economic development in case of Pakistan. In this study secondary
data from 1985 to 2016 is taken to examine the relationship. The investigation included
GDP as explained and exports and FDI as explanatory variables. To check data either it
is stationary or not the study used Augmented Dickey Fuller test in our study. After
making data stationary we have used OLS method to investigate the nature of
relationship between the variables. Our results show that there is direct link amongst
explained and explanatory variable. The findings also show that there is significant
relationship between FDI and economic growth. After analyzing the calculations we
came to know that foreign direct investment is a significant element for the economic
development because it has positive impact and have significant relation with growth of
an economy. Since FDI is an impressive element in economic development so,
government should take steps to attract the foreign investors and make policies to
encourage the trade liberalization to gain more from the foreign investment.
Rummana Zaheer, Shahana Kiramat. (2019) THE RELATIONSHIP BETWEEN FOREIGN DIRECT INVESTMENT AND ECONOMIC GROWTH OF PAKISTAN, Journal of Social Science and Humanities, Volume 58, Issue 1.
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