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A Re-Examination of the Relationship between Electricity Consumption and Economic Growth in India

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  • Kamaljit Singh
  • Simmi Vashishtha

Abstract

The intent of the study is to re-examine the relationship between per capita electricity consumption and per capita Gross Domestic Product (GDP) from 1971 to 2014. By employing the Granger causality test, the study found that there was absence of a long-term equilibrium relationship between per capita electricity consumption and per capita GDP in India, but the existence of unidirectional causality running from per capita GDP to per capita electricity consumption was reported in a Vector Autoregression (VAR) framework. The results indicate that the policymakers should encourage energy conservation measures on both the supply and demand-side which will lead to sustainable energy supply in the country. This will lead to a sustainable energy supply in the country. Moreover, if the government in collaboration with the power utility industries frames the appropriate national policy on energy conservation for entering the practical action, it will enhance economic development on a sustainable basis.

Suggested Citation

  • Kamaljit Singh & Simmi Vashishtha, 2020. "A Re-Examination of the Relationship between Electricity Consumption and Economic Growth in India," Energy Economics Letters, Asian Economic and Social Society, vol. 7(1), pages 36-45.
    • Handle: RePEc:asi:eneclt:v:7:y:2020:i:1:p:36-45:id:175
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    Citations

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    Cited by:

    1. Hlalefang Khobai & Sanderson Abel & Pierre Le Roux, 2021. "A Review of the Nexus between Energy Consumption and Economic Growth in the BRICS Countries," International Journal of Energy Economics and Policy, Econjournals, vol. 11(3), pages 424-431.
    2. Palesa Milliscent Lefatsa & Kin Sibanda & Rufaro Garidzirai, 2021. "The Relationship between Financial Development and Energy Consumption in South Africa," Economies, MDPI, vol. 9(4), pages 1-21, October.
    3. Husnain, Muhammad Iftikhar ul & Nasrullah, Nasrullah & Khan, Muhammad Aamir & Banerjee, Suvajit, 2021. "Scrutiny of income related drivers of energy poverty: A global perspective," Energy Policy, Elsevier, vol. 157(C).
    4. Mohammad Al-Zuhair & Talal AL-Bazali, 2022. "Causality Between Energy Consumption and Economic Growth: The Case of Kuwait," International Journal of Energy Economics and Policy, Econjournals, vol. 12(6), pages 22-29, November.
    5. Zhongwu Zhang & Guokui Wang & Xiaojia Guo, 2022. "Long-Term and Short-Term Effects of Carbon Emissions on Regional Healthy Development in Shanxi Province, China," Sustainability, MDPI, vol. 14(9), pages 1-14, April.
    6. Ponle Henry Kareem & Mumtaz Ali & Turgut Tursoy & Wagdi Khalifa, 2023. "Testing the Effect of Oil Prices, Ecological Footprint, Banking Sector Development and Economic Growth on Energy Consumptions: Evidence from Bootstrap ARDL Approach," Energies, MDPI, vol. 16(8), pages 1-19, April.

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