Country of origin and industry FDI agglomeration of MNEs: evidence from India

The spatial distribution of FDI is highly concentrated in India. This study analyses how the collocation of investors from the same country and same industry contributes to the spatial concentration of FDI. Based on the country of origin and industry sector, we categorise the greenfield investments into four categories: investors from the same countries and the same industry, same country and different industry, different countries and same industry and investors from different countries and different industries and analyse its role on FDI agglomeration. Our empirical analysis finds prior investment has a key role in the location choice of new investments. Further, the country of origin and industry sector of prior investments is associated with the location choice of new investors which leads to the FDI agglomeration in that region.