Analyzing the Role of Political Risk, GDP, and Eco-Innovations Towards CO2 Emissions in South Asian Countries

This research work estimates the impacts of political risk towards carbon emissions while incorporating the role of technological innovations, financial development, economic growth, and trade, in panel data of Pakistan, India, Bangladesh, and Sri Lanka. In doing so, the yearly data of 1984–2017 is analyzed by adopting an advanced econometric method of the cross-sectional autoregressive distributed lag (CS-ARDL) approach. The Westerlund co-integration test confirms the strong association among the variables, and the results of CS-ARDL show that innovations, economic growth, and trade are not environmentally friendly in South Asian countries. Furthermore, financial development and a stable political environment are important to achieve carbon neutrality in developing South Asian countries. This work diverts the attention of policymakers in making a stable political environment. This will improve the environmental quality and save these countries from future drastic climatic variability.