Hockey officials, who put the team's departure on hold following last week's threat, said on Monday they had assessed advice from the New Zealand government and an independent adviser on security arrangements in India.
"The detail we have received has reassured us that the required level of security is in place, therefore we have kept the team in the tournament," Hilary Poole, chief executive of Hockey New Zealand, said.
Poole said one player, Simon Child, had made a personal decision to pull out.
She said Hockey New Zealand had been closely liaising with other nations, "all of whom still plan to participate".
The Asia Times online newspaper said it had received a message Feb 15 from guerrilla commander Ilyas Kashmiri, whose 313 Brigade is an operational arm of Al Qaeda, indicating the tournament and other scheduled sporting events in India this year would be targeted.
The warning also referred to next month's Indian Premier League cricket competition and the Commonwealth Games, to be held in New Delhi in October.