Research on the Determinants of Chinese Enterprises′ Direct Investment in India

Abstract

Abstract: With the rapid economic development, India has become one of the most attractive investment hotspots in the world，and is an important country along the“Belt and Road”, which has a huge investment market. From the perspective of deepening Sino-Indian industrial capacity cooperation and realizing technological transfer, Chinese enterprises have great potential for direct investment in India. By investigating the status and characteristics of Chinese enterprises′ direct investment in India, the paper builds a determinant model of direct investment and empirically analyzes the determinants of Chinese enterprises′ direct investment in India. The results show that there is a “paradox on the relationship between Indian demographic dividend and foreign direct investment”: in the long run, India′s demographic dividend has little impact on Chinese enterprises′ direct investment in India; due to India′s technology transfer policy and “Safety Review” on foreign direct investment, India′s input in scientific research has little impact on Chinese companies′ direct investment in India. Therefore, the size of the India market, the R&D investment of India and the export of China to India are the main factors that affect China′s direct investment in India. The trade frictions between China and India have an impact on China′s direct investment in India.

Key words: Chinese enterprises, OFDI, India, determinants

GONG Xiu-guo, XIE Xiang-wei. Research on the Determinants of Chinese Enterprises′ Direct Investment in India[J]. 商业研究.

References

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