Green Growth in India: Nexus Between Renewable Energy Deployment and Economic Sustainability

Authors: Nikhil Bhardwaj, Nalinee Chauhan

DOI: https://doi.org/10.37082/IJIRMPS.v13.i3.232453

Short DOI: https://doi.org/g9h4h9

Country: India

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Abstract: India's push towards renewable energy has accelerated over the last decade, driven by the dual imperatives of economic growth and climate action. This study examines the relationship between renewable energy deployment, economic growth, and carbon emissions in India from 2015 to 2023. Using the ARDL bounds testing approach, we analyse both short-run and long-run dynamics between GDP, renewable energy capacity, and CO₂ emissions. Granger causality tests are also applied to determine the direction of causality among variables. The empirical findings reveal a significant long-run positive relationship between renewable energy expansion and GDP, indicating that clean energy investments contribute meaningfully to macroeconomic performance. Conversely, CO₂ emissions are found to negatively affect GDP, highlighting the environmental costs of fossil-fuel-dependent growth. Furthermore, the Granger causality test confirms a unidirectional causality from renewable energy to GDP, reinforcing the notion that renewables are a driver, not just an outcome, of economic development. These results are supported by robust diagnostic tests. The study concludes with policy recommendations inspired by successful models in countries like Germany, China, and Brazil, suggesting how India can align its green transition with sustainable economic outcomes.

Keywords: Renewable Energy, Economic Growth, ARDL Model, CO₂ Emissions, Granger Causality, Sustainable Development, India

Paper Id: 232453

Published On: 2025-05-04

Published In: Volume 13, Issue 3, May-June 2025

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