DETERMINANTS OF FOREIGN DIRECT INVESTMENT (FDI) IN PAKISTAN'S AGRICULTURAL SECTOR

Pakistan is an agricultural based economy, therefore, agricultural sector is one of the most important sectors of Pakistan as it provides employment opportunities to millions of people, contributes significantly in GDP, fulfills local demand for food items, export variety of commodities to foreign countries, boosts foreign exchange reserves and eventually enhances economic growth rate of Pakistan's economy. This study has investigated the determinants of FDI in agricultural sector of Pakistan. The results have shown that GDP and trade openness have positive and significant relationship with FDI inflows in Pakistan agricultural sector whereas government debt has negative and significant relationship. The results have further revealed that inflation has positive whereas exchange rate has negative relationship with FDI inflows in Pakistan's agricultural sector but both of these variables have insignificant relationship with FDI.