The impact of terrorism on trade in India

The conventional view of terrorism is that it raises risks and thus, reduces trade. In this paper, we investigate the effects of terrorism on India and Pakistan trade. Each additional terrorist attacks in any country decline trade. In this research paper the author used statistics tools to test hypothesis accept or reject by ANOVA and regression to show that this hypothesis is not necessarily correct. They use this test to show that terrorism can either reduce or raise trade depending on critical factors, such as the impact of terrorism on the intensive factor of the export or the import sector. They then extend the analysis test with several goods and factors and identify conditions under which trade may rise or fall with a greater incidence of terrorism. The results show that the terrorism activities have a negative impact on trade of the country.