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This paper assesses the growth implications of foreign direct investment (FDI) in India. The authors subject industry-specific FDI and output data to Granger causality tests within a panel co-integration framework. They find that the growth effects of FDI vary widely across sectors. While FDI stocks and output are mutually reinforcing in the manufacturing sector, any causal relationship is absent in the primary sector. Moreover, they only find transitory effects in the services sector.