Greening Tomorrow: A Comparative Outlook on Sustainability in India and China

In contemporary research, there is a growing emphasis on the goal of reducing carbon emissions to build a green and sustainable planet. The rise in carbon emissions has resulted in a significant increase in global temperatures and subsequent changes in the climate worldwide. India and China, the two biggest contributors to GHG emissions in the world, face huge challenges in this regard. Securing sufficient financing is essential for these countries to achieve their climate goals. This study employs the bound test method and Autoregressive Distributed Lag Error Correction Model (ARDL-ECM) methodology to estimate the long-term and short-term associations among carbon emissions, green financing, renewable energy usage, and financial development in India and China. The findings reveal that green finance mitigates emissions per capita in China, while it has the opposite effect in India. Conversely, the adoption of renewable energies contributes to reducing emissions in both countries. Furthermore, financial development in China is linked with an increase in carbon emissions, whereas India has not seen a significant impact. Thus, examining these contradictory situations is a necessary step towards establishing an international consensus on climate change mitigation strategies for both countries.