Analysis of India Outbound FDI Determinants Using Gravity Model Approach Zoha Asghar and Pankaj Kumar Gupta Abstract Foreign Direct Investment (FDI) has emerged as an important factor in the economic growth of nations worldwide. In the context of developing and transition economies, FDI does not only serve as a source of finance for economic develop- ment, but also acts an interactive face of Multinational Enterprises for export and deployment of capital assets thereby boosting the home domestic markets. In devel- oping economies like India, both inward and outward FDI investments have shown a tremendous increase in the recent decade. Though various researches have been conducted to examine the patterns of and factors affecting inbound FDI investment, we find a significant research gap in relation to the trends and determinants of Out- ward FDI (OFDI) particularly in the context of macroeconomic indicators like GDP and GFC. We, therefore examine the determinants of Indian OFDI using a gravity model approach applied to investments made in selected European countries that account for the major share of OFDI for a period of 2011–2016. Results indicate that all selected macroeconomic variables have a significant influence on OFDI. Also, the need for Natural Resources, Market Size and Openness and Technology seeking motives are the key determinants of Indian OFDI to European nations. Keywords FDI · Outward FDI · Gravity model · GDP 1 Introduction Foreign Direct Investment has conventionally been an indicator of the global financial health and of the investment climate for all economies. The swing in the OFDI by developing and transition economies is a matter of debate and has attracted the attention of researchers for exploration with respect to its determinants. The impact Z. Asghar (B ) · P. K. Gupta Centre for Management Studies, JMI University, New Delhi 110025, India e-mail: zoha.phd2016@gmail.com P. K. Gupta e-mail: pkgfms@gmail.com © Springer Nature Switzerland AG 2019 D. Procházka (ed.), Global Versus Local Perspectives on Finance and Accounting, Springer Proceedings in Business and Economics, https://doi.org/10.1007/978-3-030-11851-8_4 43