Empirical research on the relationship between renewable energy consumption, foreign direct investment and economic growth in South Asia

Emon Kalyan Chowdhury and Rupam Chowdhury

Abstract

This paper intends to scrutinize the link between renewable energy consumption, foreign direct investment (FDI) and economic progress in South Asian countries. This study applies random effect and generalized method-of-moments models using panel data from 1990 to 2020. The empirical results indicate that FDI and renewable energy consumption have a significant positive impact on economic progress, while FDI has a negative impact and economic progress has a significant positive impact on renewable energy consumption in South Asian countries. This study proposes a few approaches to using FDI in renewable energy sectors to enhance the economic progress of this promising economic base in Asia.