Water Terrorism, Water Availability, and Economic Performance: Empirical Evidence from South Asia

https://doi.org/10.5281/zenodo.18072857

Abstract

This study investigates the complex interrelationship between water terrorism, water availability, and economic performance across South Asian countries using panel data spanning from 2000 to 2023. Employing Granger causality and co-integration techniques, the analysis examines both long-term associations and the direction of causality among the variables. Unit root tests confirm that all variables are stationary at their first differences. The Granger causality results reveal a bidirectional causal relationship between water terrorism (WT) and water availability (WA), supported by F-statistics of 3.34165 and 5.25302 and corresponding p-values of 0.0051 and 0.0001, both below the 5% significance level. Additionally, unidirectional causality is identified from WT to economic performance (EP) (F = 6.59391, p = 0.0021), and from WA to EP (F = 8.08614, p = 0.0006), indicating that both water conflict and access significantly influence economic outcomes. The Kao and Pedroni co-integration tests further confirm robust long-term relationships among the variables. These findings underscore the critical role of water security and governance in shaping the economic resilience of South Asian economies, especially in sectors heavily reliant on water resources. The study offers policy recommendations for strengthening regional water cooperation and addressing the economic threats posed by water-related conflicts.