Foreign direct investment has a positive and significant impact on economic growth in the short run, whereas that of trade openness is both in the long and short run. The economic growth of India is caused by FDI, trade openness, and exchange rate, separately as well as together, in the short run. The findings advocate for measures and regulations to manage FDI and prioritise human capital development, financial sector enlargement, and trade expansion as well as improved trade policy reforms to eliminate numerous trade restrictions to ensure sustained long–run economic growth in the country.
