The Influence of Agriculture, Renewable Energy, International Trade, and Economic Growth on India's Environmental Sustainability

Abstract

Agriculture significantly contributes to the economic growth of many developing nations, while energy policies aimed at combating climate change play a crucial role in bolstering this growth. This paper examines the relationship between agriculture, renewable energy, trade openness, and economic growth on carbon dioxide (CO₂) emissions in India from 1965 to 2022. The unit root tests confirmed the stationarity of the data, and the autoregressive distributed lag (ARDL) bound testing confirmed a long-run relationship among variables. The results of the ARDL long-run elasticities indicate that a 1% increase in agriculture productivity and trade openness led to a respective increase in CO₂ emissions of 0.42% and 0.20%, respectively. In addition, a slight increase in usage of renewable energy was found to have a positive impact on reducing CO₂ emissions, while economic growth also contributed to a small decrease in emissions. The findings confirmed the validity of the environment Kuznets curve (EKC) alongside the pollution haven hypothesis in the context of India. The findings suggest that implementing renewable energy usage, low-carbon economy, and trade reforms, along with robust environmental policies that minimize CO₂ emissions, can contribute to the development of the agriculture sector and green economy.