ISSN (Print) - 0012-9976 | ISSN (Online) - 2349-8846
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FDI Spillovers and Export Performance of Indian Manufacturing Firms after Liberalisation

The spillovers from foreign direct investment through multinational enterprises have attracted considerable attention in recent times. Existing empirical studies on fdi spillovers largely look at the productivity enhancing effects and horizontal spillovers of foreign firms in the same industry sector ignoring the possibility of spillovers through buyer-supplier or backward linkages. The present study examines the impact of horizontal as well as backward spillovers from the presence of foreign firms, on the export performance of domestic firms in the Indian manufacturing industry during 1993-2008. Increased competition in the domestic market post-liberalisation through sales of foreign firms is forcing domestic firms to look for export markets. The results indicate that domestic firms are not benefited in improving their export performance through any buyer-supplier linkages with the mnes.

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