Transition to green transportation under the lens of energy inflationary pressures: the empowering role of digital financial inclusion

Abstract
The transportation sector is considered one of the biggest contributors to global carbon footprints. Therefore, the green transformation of the transportation sector is crucial for the world’s sustainable development. In this analysis, we aim to investigate the influence of energy inflation and digital financial inclusion on the green transport sector. For empirical analysis, we employ the 2SLS and system GMM methods. As per the research outcomes, energy inflation helps enhance the green transport industry. Digital financial inclusion is also a vital contributor to the development of the green transportation industry. Individual indicators of digital financial inclusion, such as bank branches, debit and credit cards, and ATMs, all significantly and positively influence green transportation. In addition, ICT, GDP, and trade also foster the development of the green transport industry, whereas foreign direct investment hinders the growth of the green transport sector. Thus, higher energy prices and digital financial inclusion provide an opportunity for policymakers to enhance investment in the greening of the transportation sector.