Carbon dioxide emissions, forest area, and economic growth of SAARC countries: Evidence from FMOLS approach
This study aims to examine the relationship between CO2 emissions, forest area, and GDP in each South Asian Association for Regional Cooperation (SAARC) country. This study uses a panel dataset that spans South Asian countries from 1990 to 2020 for econometric analysis. The Fully Modified Least Squa...
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2025-01-01
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| author | Yadav Mani Upadhyaya Khom Raj Kharel Omkar Poudel Pramshu Nepal |
| author_facet | Yadav Mani Upadhyaya Khom Raj Kharel Omkar Poudel Pramshu Nepal |
| author_sort | Yadav Mani Upadhyaya |
| collection | DOAJ |
| description | This study aims to examine the relationship between CO2 emissions, forest area, and GDP in each South Asian Association for Regional Cooperation (SAARC) country. This study uses a panel dataset that spans South Asian countries from 1990 to 2020 for econometric analysis. The Fully Modified Least Squares (FMOLS) method adds annual forested area to the regression model. The study results show that India, Nepal, Pakistan, and Sri Lanka must prioritize decoupling CO2 emissions from economic growth, as their strong correlation shows significant environmental costs of development. Although Bangladesh, Bhutan, and the Maldives are in a slightly better position, they need strategies to manage emissions as they progress economically. The study once again revealed a relationship between a 1% increase in GDP and a 0.68% rise in CO2 emissions, whereas a 1% increase in forest area led to a slightly higher 0.79% rise in CO2 over the period. The hypotheses testing results confirm a positive correlation between economic growth and carbon dioxide emissions in SAARC countries, indicating that emissions rise as economies expand. Additionally, a negative relationship was found between forest area and carbon dioxide emissions, where larger forest coverage is linked to lower emissions. The conclusion is that an increase in forest area is associated with a relatively small increase in CO2 emissions, indicating that the relationship between forest area and CO2 emissions is less pronounced compared to GDP. |
| format | Article |
| id | doaj-art-4f0bd2d9d4194969b530e4d250c72912 |
| institution | Kabale University |
| issn | 1998-6041 1998-605X |
| language | English |
| publishDate | 2025-01-01 |
| publisher | LLC "CPC "Business Perspectives" |
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| series | Environmental Economics |
| spelling | doaj-art-4f0bd2d9d4194969b530e4d250c729122025-01-23T08:47:41ZengLLC "CPC "Business Perspectives"Environmental Economics1998-60411998-605X2025-01-01161132910.21511/ee.16(1).2025.0221382Carbon dioxide emissions, forest area, and economic growth of SAARC countries: Evidence from FMOLS approach Yadav Mani Upadhyaya0https://orcid.org/0000-0003-3089-3615Khom Raj Kharel1https://orcid.org/0000-0002-9806-7224Omkar Poudel2https://orcid.org/0009-0008-7873-0237Pramshu Nepal3https://orcid.org/0009-0009-7116-636XAssistant Professor of Economics, Dr., Tribhuvan University, Saraswati Multiple Campus, NepalAssociate Professor of Economics, Dr., Tribhuvan University, Saraswati Multiple Campus, NepalAssistant Professor of Economics, Birendra Multiple Campus, Tribhuvan University, NepalAssociate Professor, Central Department of Economics, Tribhuvan University, NepalThis study aims to examine the relationship between CO2 emissions, forest area, and GDP in each South Asian Association for Regional Cooperation (SAARC) country. This study uses a panel dataset that spans South Asian countries from 1990 to 2020 for econometric analysis. The Fully Modified Least Squares (FMOLS) method adds annual forested area to the regression model. The study results show that India, Nepal, Pakistan, and Sri Lanka must prioritize decoupling CO2 emissions from economic growth, as their strong correlation shows significant environmental costs of development. Although Bangladesh, Bhutan, and the Maldives are in a slightly better position, they need strategies to manage emissions as they progress economically. The study once again revealed a relationship between a 1% increase in GDP and a 0.68% rise in CO2 emissions, whereas a 1% increase in forest area led to a slightly higher 0.79% rise in CO2 over the period. The hypotheses testing results confirm a positive correlation between economic growth and carbon dioxide emissions in SAARC countries, indicating that emissions rise as economies expand. Additionally, a negative relationship was found between forest area and carbon dioxide emissions, where larger forest coverage is linked to lower emissions. The conclusion is that an increase in forest area is associated with a relatively small increase in CO2 emissions, indicating that the relationship between forest area and CO2 emissions is less pronounced compared to GDP.https://www.businessperspectives.org/images/pdf/applications/publishing/templates/article/assets/21382/EE_2025_01_Upadhyaya.pdfcarbon emissionseconomic growthenvironmental sustainabilityforest areaforest preservationgreen practices |
| spellingShingle | Yadav Mani Upadhyaya Khom Raj Kharel Omkar Poudel Pramshu Nepal Carbon dioxide emissions, forest area, and economic growth of SAARC countries: Evidence from FMOLS approach Environmental Economics carbon emissions economic growth environmental sustainability forest area forest preservation green practices |
| title | Carbon dioxide emissions, forest area, and economic growth of SAARC countries: Evidence from FMOLS approach |
| title_full | Carbon dioxide emissions, forest area, and economic growth of SAARC countries: Evidence from FMOLS approach |
| title_fullStr | Carbon dioxide emissions, forest area, and economic growth of SAARC countries: Evidence from FMOLS approach |
| title_full_unstemmed | Carbon dioxide emissions, forest area, and economic growth of SAARC countries: Evidence from FMOLS approach |
| title_short | Carbon dioxide emissions, forest area, and economic growth of SAARC countries: Evidence from FMOLS approach |
| title_sort | carbon dioxide emissions forest area and economic growth of saarc countries evidence from fmols approach |
| topic | carbon emissions economic growth environmental sustainability forest area forest preservation green practices |
| url | https://www.businessperspectives.org/images/pdf/applications/publishing/templates/article/assets/21382/EE_2025_01_Upadhyaya.pdf |
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