The Impact of Climate Change on Economic Growth in South Asian Countries: The Role of Financial Development, Trade Openness and Renewable Energy Consumption

Abstract

This study examines the complex correlation between climate change and economic growth in South Asian nations, focusing specifically on the significant influences of financial development, trade openness, and renewable energy usage. This research endeavors to address the existing information gaps pertaining to the impact of climate change on economic development, with a specific focus on the susceptibility of South Asian nations. This study employs quantitative research approach. Economic indicators, climate data, and relevant financial and trade metrics are scrutinized to discern patterns and relationships. The methodology incorporates a multi-faceted approach to capture the complexity of the interactions between climate change variables and economic parameters. The study’s results provide significant insights into the intricate relationship among climate change, financial growth, trade openness, and renewable energy use in the South Asian region. The research elucidates how climate-induced disruptions impact economic sectors crucial to the region’s development. Moreover, it dissects the specific mechanisms through which financial structures, trade policies, and renewable energy initiatives influence economic resilience in the effect of climate challenges. Based on the findings, the study offers a set of targeted recommendations for policymakers, emphasizing the need for integrated approaches to climate change alleviation and adjustment. These recommendations encompass strategies for enhancing financial mechanisms, optimizing trade policies, and promoting sustainable practices in renewable energy consumption. By aligning economic policies with environmental sustainability goals, the recommendations aim to guide South Asian countries toward resilient and sustainable development pathways amidst the evolving landscape of climate change challenges.