Paper Title
On the Nexus between Financial Development and Economic Growth: An Econometric Investigation for Indian Economy

Using time-series data from 1990 to 2018 for the Indian economy and employing principal component (PCA) and autoregressive distributive lag model (ARDL), this study addresses two aspects of finance-growth nexus. First, through PCA, it develops a financial development index that measures the Indian economy's financial depth. Second, the ARDL technique examines the long-run and short-run relationship between India's financial development and economic growth. Our empirical results from the index created through PCA validate that financial development has accelerated over the said period. Moreover, the study results confirm the long-run and short-run relationships between India's financial development and economic growth using the ARDL technique. Therefore, the results of this study substantiate the view that financial development enhances economic growth in India. This implies that financial development has resulted in the desired outcome of a more stable economy. The government needs to emphasize those activities that increase financial development, leading to economic growth.