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Natural disasters' influence on industrial growth, foreign direct investment, and export performance in the South Asian region of Belt and road initiative

Author

Listed:
  • Lochan Kumar Batala

    (Henan University)

  • Wangxing Yu

    (Henan University)

  • Anwar Khan

    (Southwestern University of Finance and Economics)

  • Kalpana Regmi

    (Anhui Agricultural University)

  • Xiaoli Wang

    (Henan University)

Abstract

The study was conducted to elaborate on the impact of two main components of natural disasters (Population affected and damages) on FDI, industrial growth, and export performance of the South Asian region alongside the Belt and road initiative over 1990–2016. We have conducted cross-sectional dependence (CDP) and slope homogeneity analysis of the data; after finding that the slopes are heterogeneous and CDP found, we have employed second-generation cointegration, Westerlund, the empirical results supported there is a cointegration relationship between the variables. The empirical results obtained from the Augmented mean group long run estimator concluded that the impact of severe natural disasters on FDI is negative; we have found a partially positive effect on exports and a significantly positive relationship with industrial growth for the study area. The role of income and trade openness acts as substantial and positive determinants towards FDI, exports, and the industrial growth for the South Asian countries. However, interestingly, the empirics found the impression of energy consumption partially influential for all the models. In addition, inflation poses a negative role in the dependent variable for the study area. Finally, the policies are discussed for the negative responses of natural disasters and the positive responses that have been reached in the current study.

Suggested Citation

  • Lochan Kumar Batala & Wangxing Yu & Anwar Khan & Kalpana Regmi & Xiaoli Wang, 2021. "Natural disasters' influence on industrial growth, foreign direct investment, and export performance in the South Asian region of Belt and road initiative," Natural Hazards: Journal of the International Society for the Prevention and Mitigation of Natural Hazards, Springer;International Society for the Prevention and Mitigation of Natural Hazards, vol. 108(2), pages 1853-1876, September.
    • Handle: RePEc:spr:nathaz:v:108:y:2021:i:2:d:10.1007_s11069-021-04759-w
    DOI: 10.1007/s11069-021-04759-w
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    Cited by:

    1. Hayato Kato & Toshihiro Okubo, 2022. "The Resilience of FDI to Natural Disasters Through Industrial Linkages," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 82(1), pages 177-225, May.
    2. Robert Reinhardt, 2022. "Shaking up Foreign Finance: FDI in a Post-Disaster World," Post-Print halshs-03908250, HAL.
    3. Robert Reinhardt, 2022. "Shaking up Foreign Finance: FDI in a Post-Disaster World," Documents de travail du Centre d'Economie de la Sorbonne 22024, Université Panthéon-Sorbonne (Paris 1), Centre d'Economie de la Sorbonne.
    4. Robert Reinhardt, 2022. "Shaking up Foreign Finance: FDI in a Post-Disaster World," Université Paris1 Panthéon-Sorbonne (Post-Print and Working Papers) halshs-03908250, HAL.
    5. Robert Reinhardt, 2022. "Shaking up Foreign Finance: FDI in a Post-Disaster World," Working Papers halshs-03908250, HAL.
    6. Robert Reinhardt, 2022. "Shaking up Foreign Finance: FDI in a Post-Disaster World," Documents de travail du Centre d'Economie de la Sorbonne 22024r, Université Panthéon-Sorbonne (Paris 1), Centre d'Economie de la Sorbonne, revised Sep 2023.

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