Is Moderating effect of Uncertain Economic Policies helpful for a Sustainable Environment in Emerging Economies?

The basic priority to neutralize carbon emissions (CE) is to achieve the sustainable development goal of climate action. In this regard, the role of renewable energy (RE) is widely debated. Transition to RE and environment-related innovation in technologies (ERIT) is a need of the hour. However, the challenge of uncertain economic policies in the transition process is interesting to study. Therefore, the present study intends to add a value to the literature by re-examining the interactive effect of economic policy uncertainty (EPU) in RE and ERIT and the transition process towards carbon neutrality. The second-generation econometric methodology is applied to empirically test the proposed interactive linkage of EPU, RE, ERIT, and CE. Findings reported the negative role of EPU in adopting RE and ERIT in seven emerging economies: Brazil, China, India, Indonesia, Mexico, Russia, and Turkey. However, the ERIT and RE are found to be supportive of neutralizing the CE. Emerging seven (E7) countries are suggested to be consistent in their economic policies to nurture the transition process toward a sustainable environment.