AN ANALYSIS OF CAUSAL RELATIONSHIP BETWEEN MAJOR ECONOMIC VARIBALES

Abstract

India contemplates Atma nirbharta, the economic policy should also strive to promote export dynamism and propel Indian economy to the path of long term sustained economic growth and development.Exports and imports are one of the fundamental drivers of engine of growth for any economy. It can have an impact on countryÂ’s Gross Domestic Product (GDP), exchange rate, level of inflation as well as interest rates.An Attempt has been made whether Export have causal relationship on GDP or Import have causal relationship on GDP, to conclude import increases, which may lead to increases GDP, when import materials can be value added and finally it increases GDP. In case of exports there is significant impact of exports on GDP but GDP does have significant impact on Exports. India, unlike the Asian Tigers, has never managed to be an export-driven economy.