Assessing the impact of democratic governance, long and short-term external debt on hydropower generation in BRICS nations using an extended STIRPAT model

As climate change and energy security challenges intensify, nations are prioritizing renewable energy, with hydropower contributing 60 % of global renewable electricity. However, emerging economies like the BRICS nations face significant financial and technological obstacles in expanding their hydropower capacity. Although external debt presents a potential financing avenue, empirical analysis on the effects of disaggregated external debt: both long-term and short-term, and democratic governance on hydropower generation in these countries is limited. This study aims to address this gap by examining how these factors influence hydropower investments using the STIRPAT model as a theoretical framework. Analyzing a panel dataset from 2000 to 2020 with the Two-Stage Least Squares (2SLS) method reveals that a 1 % increase in long-term external debt leads to a 0.271 % rise in hydropower generation, while a 1 % increase in short-term external debt decreases hydropower generation by 1.022 %. Again, high-debt countries experience negative impacts from both short-term and total external debt, whereas low-debt countries benefit from long-term debt. Finally, improvements in democratic governance, including egalitarian, deliberative, electoral, participatory, and liberal dimensions, are positively associated with hydropower generation. We recommend promulgating policies that strengthen democratic frameworks to enhance accountability and secure long-term financing strategies in high-debt nations.