IMPLICATION OF THE EASE OF DOING BUSINESS FOR FOREIGN DIRECT INVESTMENT: A PANEL DATA ANALYSIS OF ASIAN COUNTRIES

This study examined the behaviour of businesses in 46 Asian republics from 2004 to 2019 that were ranked high on the business index of the World Bank. The study uses the ten parts of the commercial index as independent variables. The interest rate, rise in general price level, per capita GDP, and population are the focus variables of the research. The variables' values were derived from the WDI and Doing Business Index. The goal of this research is to determine why Asian countries receive the most foreign direct investment (FDI). The study used fixed effect, random effect and instrumental variable techniques for estimation. According to the findings, factors of the Doing Business Index, such as business startup, obtaining electricity, obtaining building licences, and property registration, have analytically substantial implications for foreign direct investment when the business is relocated. Similarly, obtaining financial assistance, defending minority investors, resolving commercial disputes, and enforcing contracts revealed significant affirmative impacts on FDI influx. Only two factors, paying taxes and cross-border trade, have a strong negative relationship with FDI influx. The study's findings can aid policymakers in improving the commercial atmosphere in terms of the characteristics that affect the Doing Business Index. On the other hand, according to the report, to considerably increase FDI inflows in the future, there is a significant need to increase reliability in the enforcement of contracts, to improve the equitability of electric utilities, to improve tax procedures, and to properly deal with construction permits.