The paper analysis the flows of Foreign Direct Investment and common factors that drive the Foreign Direct Investment flows between India and Gulf Cooperation Council countries, in this paper for empirical analysis of flow of FDI, gravity model of international trade executed, data is collected from the secondary sources from the year 2001 to 2022. The main objective of the paper is to know that how FDI is effect by the GDP of two regions like India and GCC countries and other determinants of FDI in this paper, finding of the paper describes factors like GDP of India and GCC countries and employment, real effective exchange rate of India as a regressor in the model are very deterministic for explaining the flow of FDI between India & GCC countries, and in future it will benefits the countries for their development and growth.

Most developing countries in the world are working hard to attract more foreign direct investment. Identifying the key determinants of foreign direct investment is therefore seen as an essential task for policy makers. Compared to other parts of the world, the performance of ASEAN countries in attracting foreign direct investment is still poor. This study deals with identifying the determinants of foreign direct investment inflow in ASEAN 4 (Cambodia, Laos, Myanmar, and Vietnam) countries. This study estimates the panel data sample with pooled OLS and fixed and random effect models. The analyzed data covered for the period 2000 to 2020. The empirical results indicate that market size and natural resources are the most robust determinants for FDI inflows into Cambodia, Laos, Myanmar, and Vietnam. Furthermore, the presence of labor costs, infrastructure, and exchange rate exerts a favorable influence on the inflow of FDI to CLMV countries. On the contrary, the findings of the paper reveal that the inflation rate has a detrimental effect on inward FDI. This partly reflects the fact that most of the world’s FDI is market-seeking. This study provides a clear understanding of the scope of the research in the field of FDI determinants as the practical implication for future research.