Green Finance and Public–Private Partnerships: Dynamic ARDL Insights into Renewable Energy and Air Quality Enhancement

Ongoing environmental degradation caused by climate change poses a significant threat to environmental sustainability, prompting policymakers to prioritize the rapid expansion of renewable energy. In this context, India has set an ambitious target to triple renewable energy generation by 2030. To this end, this paper empirically delves into the nexus between two key factors, i.e., green finance and public–private partnerships (PPP), and their impact on generating renewable energy specifically within India’s context, employing the Dynamic Autoregressive Distributive Lag (DYNARDL) model spanning 1994 to 2023. The result signifies that green finance has a significant negative effect on renewable energy generation in the long run, but is insignificant in the short run. In contrast, PPP negatively influences renewable energy generation in short run whereas its effect in the long run is positive and insignificant. Furthermore, green technology innovation is found to mediate the relationship between green finance and renewable energy generation, underscoring its catalytic role in facilitating clean energy growth. These results underline the need for well-regulated green finance frameworks, reformed PPP contracts with balanced risk-sharing mechanisms, and targeted R&D subsidies to boost green technological advancement, ultimately enabling India to meet its renewable energy targets and advance sustainable development goals.