Evaluating The Nexus Between Environmental Sustainability, Environmental Taxes, Environmental Innovation, And Energy Resources: A Case Study For South Asia

Abstract

This research evaluates the intricate dynamics between environmental sustainability, environment-related taxes, environment patents, and energy consumption (both renewable and non-renewable) in South Asia, for a time period of almost 2 decades. The region includes Pakistan, India, and Bangladesh. This study employed various econometric tools including the panel unit root test, cross-dependence test, Westerlund test, and the contemporaneaous correlation techniques (PCSEs and FGLS) to get a more nuanced comprehension of the interaction of these [1]variables with one another. The empirical findings of this study revealed that levying environment-related taxes is at the heart of environmental policy, and gravely helps mitigate carbon-based consumption emissions (CBCO2). Countries that employ higher environment-related taxes are associated with increased sustainability. Contingent with environment-related taxes, investment in environmental patents leads to increased ecological sustainability and helps combat CBCO2 emissions. Moreover, the findings also illustrate that the consumption of energy from renewable sources is positively related to environmental sustainability and can help preserve the environment by reducing CBCO2 emissions, while the consumption of energy from non-renewable resources negatively impacts the environment. This study highlights the importance of levying environment-related taxes, increased expenditure on eco-friendly technology, and transition to clean energy to help achieve carbon neutrality in the sample region. This study also provides deep insights into understanding the different determinants of environmental sustainability, in South Asia. The findings of the study are consistent with the objectives of the sustainable development goals, therefore, providing a framework for the South Asian region to help attain Sustainable development goals, specifically SDG7 (clean and affordable energy), SDG9 (industry and innovation) and SDG13 (climate action).