Authors: Dr. R. Shekhar
Abstract: This paper investigates the role of green finance in fostering economic growth in emerging economies. Green finance—financial flows, instruments and policies directed towards low-carbon, climate-resilient and environmentally sustainable activities—has gained increasing attention as countries strive to reconcile growth and sustainability. Drawing on recent empirical literature and four illustrative case-studies from Brazil, India, Indonesia and South Africa, this article explores the channels through which green finance supports GDP growth, identifies the key challenges faced in emerging markets, and offers suggestions for policymakers to strengthen the green-finance-growth nexus. The findings indicate that green finance contributes positively to economic growth by mobilising investment into renewable energy, enhancing energy efficiency, and lowering long-term environmental-risk premia. However, the magnitude and stability of the effect vary significantly across countries, depending on institutional quality, financial market depth and regulatory frameworks. The article concludes with policy recommendations aimed at scaling green finance in emerging economies while safeguarding growth and sustainability.
DOI: http://doi.org/10.5281/zenodo.17607167
