Abstract

The paper explores the Nexus between transport infrastructure and economic growth in India over the period 1970-2007. Using cointegration and error correction model (ECM), the paper finds a unidirectional causality from transport infrastructure to economic growth. It also finds a unidirectional causality from transport infrastructure to gross capital formation and then bidirectional causality between economic growth and gross capital formation. The paper at the end suggests increasing transport infrastructure along with gross capital formation will lead to more economic growth in India. Therefore, a suitable transport policy should be retained to boost economic growth and to maintain sustainable economic development in the country.

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