The Impact of Dynamic Capability on Economic Performance and Innovation in the Indian Aluminium Industry

This study examines the impact of dynamic capability (DC) on economic performance and innovation outcomes in the Indian primary aluminium industry. This study aims to understand how firms leverage DC to achieve sustainable economic outcomes, while simultaneously promoting innovation. This study adopts a quantitative research design, with analysis of firm-level data from the primary aluminium sector collected between January 2025 and February 2025. Economic performance is assessed using metrics aligned with the Global Reporting Initiative (GRI) 200 series, while innovation performance is measured across product, process and business model dimensions. Structural equation modelling was used to analyse these relationships. The findings indicate a strong positive link between DC and economic and innovation performance. Firms with robust DC demonstrate superior adaptability to market changes, enabling enhanced financial outcomes and innovation processes. This study fills a crucial gap in the literature by linking DC to economic performance and innovation in a resource-intensive industry. This adds to the emerging knowledge base on sustainability and innovation, offering real-world insights for policymakers and industry leaders to foster DC as a driver of sustainable growth and competitive advantage.