A Comparative Study on Foreign Aid and Growth in 6 South Asian Countries

This study empirically examines and compares the impact of foreign aid on growth in 6 South Asian countries: Bangladesh, Bhutan, India, Nepal, Pakistan, Sri Lanka, using annual data over period 1980–2019. The empirical results for comparative analysis are based methods variance decomposition impulse response function. show that shock variation is about 1%–2% 5 countries 7.76% Nepal. means endogenous relationship between not large countries. In addition, a has positive Bhutan negative other A possible reason India these have better governance transparency than Further, fluctuation disappears 2–3 years at most, suggesting most ineffectively managed used consumer goods. Therefore, it necessary to improve so can be positively linked growth, desirable provide form increasing capital