Open Access Article

The Role of Energy Investment in Promoting Economic Sustainability in Developing Countries: A CS-ARDL Analysis

Authors

Aqeel Ahmad(1) Aqeel Ahmad Corresponding author Affiliation PhD Scholar, Department of Economics, The Islamia University of Bahawalpur, Pakistan Email addressaqeelahmed.iub18@gmail.com Other articles by this author , Tusawar Iftikhar Ahmad(2) Tusawar Iftikhar Ahmad Affiliation Associate Professor, PhD (Economics), Department of Economics, The Islamia University of Bahawalpur, Pakistan Other articles by this author , Asma Sajjad(3) Asma Sajjad Affiliation Monitoring Officer, Ministry of National Food Security & Research (MNFSR), Islamabad, Pakistan Other articles by this author , Sajjad Ali(4) Sajjad Ali Affiliation Lecturer of Economics, Govt. Sadiq Egerton Graduate College, Bahawalpur, Pakistan Other articles by this author

  1. PhD Scholar, Department of Economics, The Islamia University of Bahawalpur, Pakistan
  2. Associate Professor, PhD (Economics), Department of Economics, The Islamia University of Bahawalpur, Pakistan
  3. Monitoring Officer, Ministry of National Food Security & Research (MNFSR), Islamabad, Pakistan
  4. Lecturer of Economics, Govt. Sadiq Egerton Graduate College, Bahawalpur, Pakistan

https://doi.org/10.36923/jcmi.v6i2.673

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Abstract

Energy investment plays a pivotal role in promoting economic sustainability through a reliable energy supply to support industrial production and innovation. The current work investigates the difference in energy investment and economic sustainability between 1990 and 2022 for 88 developing countries with an income classification. Using the Cross-Sectional Autoregressive Distributed Lag (CS-ARDL) methodology, the research simultaneously tests short- and long-run dynamics while explicitly modeling cross-sectional dependence. The results suggest that although labor force participation, capital formation, human capital, and foreign direct investment have positive impacts on economic sustainability across income levels, energy investment, especially when used for creating public-private partnerships, fosters economic growth in middle-income economies but has a negative correlation with low-income economies. Policy implications drawn from the findings indicate that boosting investment in the energy sector, with special focus on the use of renewable technologies in low- income countries, would be an effective strategy for promoting sustainable development.

Article information

Keywords
Economic growthpublic-private partnership in energy investmentenergy investment with private participationforeign direct investment
Section
Articles
Issue
Vol. 6 No. 2 (2025)
Submitted
October 4, 2025
Accepted
December 18, 2025
Published
December 30, 2025
Corresponding author
Aqeel Ahmad
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