Navigating terrorism and policy stringency: a path to sustainable development through green innovations in BRICS

Climate change, environmental degradation, and the persistent threat of terrorism are complex and interconnected issues that require innovative and collaborative solutions. Among emerging economies, sustainable development remains a major priority for BRICS (Brazil, Russia, India, China, and South Africa) due to their size, large carbon footprints, and heightened vulnerability to security threats. However, the disruptive impact of terrorism often diverts resources away from environmental goals, thereby weakening the effectiveness of policy stringency and slowing the progress of green innovation. Thus, the primary aim of this study is to examine the nexus between green innovation, terrorism, and environmental policy stringency in BRICS nations. The study utilizes balanced panel data for the period 1996–2019, and the panel mean group (PMG) estimation technique is employed to examine the relationship. The key findings of the study show that terrorism negatively affects green innovation, whereas stringent environmental policies help foster green innovation. Moreover, foreign direct investment (FDI) inflows and fossil fuel consumption positively contribute to green innovation. Therefore, stringent environmental policies, which include both marketable and non-marketable environmental policy stringency instruments, with greater emphasis on marketable instruments, along with good governance conditions such as political stability and the absence of violence, should be prioritized to promote green innovation and achieve sustainable development in BRICS.