Balancing growth and sustainability: COP 28 policy implications of green energy, industrialization, foreign direct investment, and globalization in South Asia.

ABSTRACT

This research investigates the intricate relationships between economic variables and how they affect South Asian nation's ability to develop sustainably. Given the growing concerns about climate change and global warming brought on by emissions of greenhouse gases, this study looks into the connection between emissions of CO2, green energy, industrialization, foreign direct investment, economic globalization, and financial development from 1995 to 2022. Second-generation panel techniques were employed in this study to look at the relationship between variables because of the potential of residual cross-sectional dependency and heterogeneity. The empirical outcomes display that green energy, economic globalization, and financial development reduce CO2 emissions by 1.839%, 1.223%, and 3.902% respectively. Industrialization and foreign direct investment degrade the environment by 4.302% and 1.893% respectively. A bidirectional causality link between green energy, industrialization, economic globalization, and CO2 emissions was found by Dumitrescu and Hurlin (D-H). Based on our findings, we recommend legislative support for renewable energy, cleaner technologies, and strict environmental regulations, aligning with the Sustainable Development Goals (SDGs). Encouraging FDI, sustainable practices, and financial development can drive economic growth while preserving the environment. As we approach COP28, this holistic approach to sustainable development becomes increasingly vital for South Asian countries to achieve their SDG targets and combat climate change.