Revisiting the Growth–Forest Sustainability Nexus in India: The Role of Human Capital, Energy, and Trade

ABSTRACT

Understanding whether the interaction between economic activity and forest ecosystems manifests as conflict or synergy is central to designing effective, sustainable development policies. Although the environmental Kuznets curve framework is frequently utilized to explain this relationship, its analytical scope remains limited, as it conceptualizes environmental sustainability predominantly through demand‐side indicators. The forest load capacity curve hypothesis offers a more comprehensive perspective by simultaneously incorporating both the supply‐ and demand‐side dimensions of ecological quality. Despite its conceptual advantages, empirical applications of the forest load capacity curve remain notably sparse. To address this gap, the present study evaluates the validity of the forest load capacity curve hypothesis for India over the period 1965–2024. Employing the Fourier Augmented Autoregressive Distributed Lag method alongside the Dynamic Ordinary Least Squares estimator, the analysis incorporates economic growth, human capital, energy consumption, and trade openness as key explanatory factors. The results reveal a U‐shaped relationship between economic growth and forest sustainability, thereby empirically validating the forest load capacity curve hypothesis in India. Furthermore, human capital and trade openness are found to enhance environmental sustainability, whereas energy consumption exerts a detrimental impact on forest ecosystems. These results remain robust across different methodological specifications and underscore the importance of sustainable development strategies that support energy transition and strengthen human capital in order to improve the load capacity of forest ecosystems in India.