Achieving Sustainable Development Goal‐7: Exploring the Determinants of Energy Poverty in <scp>SAARC</scp> Countries

Abstract

ABSTRACT Energy poverty remains a pressing issue in developing countries, intensified by inadequate energy policies and ongoing socio‐economic and political crises. This study examines the long‐run empirical nexuses among political stability, female employment, corruption, trade deficit, income disparity, urbanization, and energy poverty in six SAARC countries (Pakistan, India, Bangladesh, Sri Lanka, Bhutan, and Nepal) from 2000 to 2020, within the context of the SDGs, specifically SDG‐7 (Affordable and Clean Energy). We applied four econometric approaches for empirical analysis: the Westerlund LM bootstrap, the PMG‐ARDL, robustness analysis, and the Dumitrescu‐Hurlin causality tests. The Westerlund LM bootstrap test validates the presence of long‐run co‐integration among variables. The long‐run PMG‐ARDL model results reveal that all the factors, including corruption, trade deficit, income disparities, and urbanization, boost energy poverty except for political stability and female employment. These results indicate that political stability and female employment are critical for achieving SDG‐7. A widening trade deficit, increasing income inequality, and rapid urbanization hinder SDG‐7 and energy poverty alleviation. Moreover, the Dumitrescu‐Hurlin causality results reveal bi‐directional causality among income disparity, corruption, political stability, and energy poverty, while female employment, urbanization, and trade deficit exhibit uni‐directional causality towards energy poverty. Based on these findings, the study suggests that policymakers should focus on improving political stability, promoting female employment, and implementing targeted interventions to decrease income disparity, combat corruption, and manage urbanization through solid policies to diminish energy poverty and ensure progress toward the 2030 SDG‐7 targets.

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