Nexus between Industrial Growth, Energy Consumption and Environmental Deterioration: OBOR Challenges and Prospects to China

摘要

The introduction of One Belt One Road Initiative (OBOR) projects intensively triggered the industrial revolt in China which can greatly degrade its environment by carbon emission in the impending time. This study empirically assesses the long run and short run ties of such industrial revolution with CO2 emission and energy demand from 1971 to 2016. The study reliable its outcomes by applying diagnostics unit root, serial correlation, autocorrelation and normality tests. By applying ARDL bound test, the study reveals the positive and significant long-run linkages between industrial growth, services sector of the economy and energy consumption with CO2 emission, however economic development negatively impacted the emissions in the China. Granger causality reveals the unidirectional causation of energy consumption, industrial progression, and economic growth to CO2 emission correspondingly. It is intimated that the Chinese rulers need to address industrial waste to avoid environmental degradation, harmful pollutant stuff caused by CO2 emission. This step will guarantee Chinese sustainable growth in the long run and will produce a very effective outcome from OBOR project. Furthermore, the policy implication available for China as well as OBOR nations, to cater the environmental issues by making strict policies for industries and focus on renewable energy sources that help to lack the CO2 emission.