Climate mitigation in practice: the interplay between green innovation, renewable energy investment, natural resource rent and urbanization

Purpose This study aims to examine how green innovation (GI), renewable energy investment (REI), natural resource rent (NRR) and urbanization (URB) influence climate mitigation in Indian. As the third-largest carbon emitter, India stands on a tightrope between rapid development and climate obligations, making the study vital for crafting context-specific, adaptive and sustainable low-carbon pathways. Design/methodology/approach The study uses a novel autoregressive distributed lag-error correction model (ARDL-ECM) to examine the impact of key explanatory variables on carbon dioxide (CO2 )emissions using a time series dataset spanning from 2000 to 2020. Robustness checks further support the findings, followed by the Ganger Causality test to uncover the causal linkage among the variables. Findings The results of the ARDL-Bound test suggest the long-term cointegration among the variables. GI significantly mitigates CO2 emissions, whereas REI shows a negative impact, though its transformative potential remains unrealized. In contrast, NRR exacerbates emissions, highlighting the economic cost of resource-driven growth. URB shows an initial decline in emissions, although it increases over time, resulting from enhanced energy demands and urban sprawl. Robustness checks indicate the absence of bias and overall model stability. The Granger Causality test suggests a bidirectional causality between URB and CO2 emission, with no significant causality observed for other explanatory variables. Originality/value The study fills a significant gap in current literature by examining the impact of GI, REI, NRR and URB on climate mitigation within a unified framework in the Indian context. Positioned at a pivotal point in its green transition, the study offers insights to navigate a country’s dual challenge of economic expansion and environmental stewardship.