Racing toward attaining sustainable development in India: Probing the asymmetric effect of country risk and coal energy

Abstract The pursuit of a sustainable environment is a common goal for many nations; however, achieving this has become increasingly difficult due to country‐specific risks, often referred to as country risk. Despite its importance, the relationship between country risk and environmental outcomes is still in its early stages of exploration. This study aims to bridge this gap by examining the influence of country risk on India's ecological footprint within an asymmetric empirical framework, while accounting for economic growth and coal energy consumption. Utilizing the nonlinear autoregressive distributed lag (NARDL) estimator, the analysis covers data from 1984 to 2018. The findings reveal that positive changes in economic and financial risk contribute to environmental improvement by significantly reducing the ecological footprint, whereas negative changes in these risks lead to an increase in ecological footprint. Additionally, positive changes in political risk, economic growth, and coal energy usage exacerbate the ecological footprint, while reductions in coal energy use and political risk lead to environmental benefits. Based on these outcomes, policymakers are encouraged to establish a clear risk benchmark and reduce the ecological footprint by fostering economic growth in a sustainable manner. Governments should also prioritize strong support for green technology investments and ensure stability across political, economic, and financial sectors to promote long‐term environmental sustainability.