Financial Inclusion, Energy Intensity, and Natural Resources: Environmental Insights From BRICS and MINT Economies

In developing economies, rapid economic growth intensifies environmental pressures, thereby increasing the importance of financial inclusion, energy intensity, and natural resource dependence for environmental sustainability. This situation necessitates a holistic examination of the determinants of environmental degradation in emerging markets, which motivates this study. In this context, the study examines the effects of financial inclusion, energy intensity, and natural resource rents on carbon dioxide (CO2) emissions in BRICS and MINT countries and empirically tests the validity of the Environmental Kuznets Curve (EKC) hypothesis. Accordingly, annual panel data covering the period 2000-2020 are analysed using a machine learning (ML)-based estimation framework, the Augmented Mean Group (AMG) estimator, and Panel Quantile Regression (PQR). The findings indicate that natural resource rents increase CO2 emissions in BRICS, whereas they reduce emissions in MINT. Moreover, energy intensity and income per capita are found to increase CO2 emissions across all quantiles in both country groups. The environmental impact of financial inclusion is heterogeneous, reducing CO2 emissions in BRICS countries while increasing emissions in MINT countries. These results underscore the critical importance of explicitly incorporating country-specific heterogeneity into environmental sustainability policy design.