Digital public infrastructure as a strategic innovation for advancing environmental sustainability in India

Digital public infrastructure (DPI) innovations are crucial for the development strategies of emerging economies, yet their environmental impacts still need examination. The present study evaluates the impact of DPI in advancing environmental sustainability in India, specifically focusing on carbon dioxide (CO₂) emissions. Utilizing a balanced panel dataset comprising 28 states from 2015 to 2024, a composite DPI index is developed to assess the DPI across the country. The investigation explores the effects of DPI expansion, the composition of renewable and non-renewable energy sources, and state gross domestic product (SGDP) on environmental degradation through economic linkages using a panel data approach. The analysis includes tests for cross-sectional dependence, unit roots, and Westerlund cointegration, as well as robust long-run estimations using Driscoll-Kraay standard errors and Dumitrescu-Hurlin panel causality tests to capture dynamic relationships. The results indicate that DPI expansion reduces CO₂ emissions, emphasizing its potential as a technological innovation that supports sustainable development. Moreover, electricity generation from non-renewable sources, increased financial credit, and rising SGDP are linked to increased emissions, and the generation of renewable energy reduces emissions. These results put forth the significance of both digital innovations and clean energy transitions in addressing environmental degradation. By combining econometric modelling with policy insights, the study enhances our understanding of how economies respond to environmental challenges, particularly in developing countries. The results indicate that improving DPI and restructuring energy sources can pave the way for achieving Sustainable Development Goal 13, relating to environmental sustainability, while promoting economic growth and financial inclusion.