Energy and Environmental Sustainability in India: An Empirical Analysis of Technological Innovation, Financial Development, and Economic Growth

Abstract

This study aims to investigate the dynamic linkages among renewable energy, technological innovation, environmental sustainability, financial development, and economic growth in the context of India. The study uses annual time-series data spanning the period from 1990 to 2022. By employing ARDL model, the findings reveal that per capital energy consumption has a positive and statistically significant effect on economic growth, indicating that economic expansion in India remains heavily reliant on energy use. Moreover, primary energy consumption shows a strong association with resource utilization and economic growth. Technological development has a positive and statistically significant impact on economic growth, suggesting that technological advancement leads to immediate benefits and improved economic and environmental outcomes for India. The results further indicate that urbanization has a positive and statistically significant effect on economic growth. This reflects the role of urban centers in fostering agglomeration economies, facilitating structural transformation, enhancing human capital, and promoting innovation and service-sector expansion in India. The policy implications of the study suggest that India should adopt advanced technologies and promote renewable forms of energy to reduce carbon dioxide emissions. Furthermore, India should focus on developing urban centers to foster agglomeration economies, facilitate structural transformation, enhance human capital, and promote innovation and service-sector expansion.