Impact of foreign investment in agricultural sector on the economic and social development of Afghanistan

Abstract

In this piece of work we studied the impact of FDI on economic and social development of Afghanistan. Through this study we come with strong rigorous findings and result. After reviewing the appropriate literature we developed the conceptual framework and hypotheses .The literature suggested that FDI in agriculture is greatly effective in bringing technology, technical skills, and innovations to the host country. It further revealed that it also encourage and bring about economic and social development. Then the relevant data was analyzed through appropriate statistical models namely Regression and Correlation. After analyzing the data, it was noticed that there is strong relationship between FDI and economic growth, FDI and Job creation, FDI and Agricultural development. That is FDI has greatly added to economic growth, Employment Creation and Agricultural Development. Further to that, those statistical models revealed strong relationship of the key economic indicators with foreign investment in agriculture in Afghanistan. That is all of them such as employment creation, economic growth agricultural development were strongly and positively correlated with the FDI inflow in the chosen period. Additionally, to elaborate on the data analysis we measured the agriculture development by the no of hectares of land cultivated by both cereals and orchards and the no of tons of production we have thereof. On the employment side we used the number of jobs created by the foreign agricultural investments and finally the economic growth , we use annual gross domestic product growth to represent the economic growth yearly. In spite of the rigorous results and findings of the study we did have some limitation of the data. That is we could not find published data over the transfer of technology or the transfer of skills, or application of innovative methods in agriculture, however in the literature cited we did come across that in countries like Afghanistan FDI has played substantial role in flow of technology and improvement in productivity and the like. Therefore, the result is significant and is highly effective in bringing about and cultivating economic and social development.