T. J. JOSEPH, ICFAI INSTITUTE FOR MANAGEMENT TEACHERS, INDIA
During the last two decades, most of the developing countries have been opening up their economies for foreign investment on the perception that foreign-owned firms, having high technological capability and world-wide marketing networks, would enhance the productivity and export performance of firms in their countries. This study examines the impact of foreign equity participation and foreign direct investment (FDI) spillovers on the export performance of manufacturing firms in India after the economic liberalization. Using a cross-section of 1430 Indian manufacturing firms for the year 2004, the study does not find any significant role for foreign ownership in the export performance of firms while the results shows significant negative export spillovers from the presence of foreign firms in the Indian manufacturing industry.
Keywords: Foreign Direct Investment; Multinational Enterprises; Foreign Ownership; Spillovers; Export Intensity; Economic Liberalization.