Exploring the role of fossil fuels, hydroelectricity consumption, and financial sector in ensuring sustainable economic development in the emerging economy.

This study is conducted to address the research question of whether hydroelectricity and fossil fuels contribute to sustainable economic development in an emerging economy in this era of globalization? Further, this study applies the novel approach of Harvey unit root test which is a linearity test to predict the possible existence of non-linearity. The results confirmed that the majority of the series in this study are linear. Furthermore, the two break test is applied to investigate the integration sequence of the series. The bounds test approach confirms the existence of a long-run association among the variables. Additionally, the long-run relationship is analysed within the framework of the ARDL approach. Financial development, fossil fuel, and capital positively contribute to economic development, while the effect of hydroelectricity is insignificant. Moreover, globalization effects GDP negatively. The symmetric causality suggests a uni-directional causal movement from hydroelectricity consumption and globalization towards GDP. The outcome of the study emphasizes the importance of renewable sources such as hydropower energy for ensuring sustainable development in the presence of globalization.