Impact of terrorism on economic growth of India: Growth on flames!

Terrorism has become a global problem in recent times which deteriorate a country's economy and global peace and security. Since independence, India has been victimised by the rampant of terrorism. To some extent, it has affected the global growth as many countries are being affected by terrorism. Hence, the paper attempts toexamine the relationship between the terrorism in India and Indian economic growth. To establish the connexion, the data for Indian terrorism scores is taken from the Global Terrorism Index and GDP is taken as proxy for Indian economic growth, for that the data is collected from the official website of Reserve Bank of India from 2001 to 2016. To estimate, we employ, Augmented Dickey Fuller Test and Philip Perron, tests of stationarity, Johenson's cointegration approach, and Granger causality/Block Exogeneity Wald tests to conclude the objective of the study. The key results depicts that there is nocointegration between the Indian terrorism and Indian economic growth confirming a non-causality using Granger causality test. Therefore, this study concludes by recommending Indian government to play a proactive role to combat this political and religious war and maintain peace and security to magnify the economic growth.