The empirical evidence on the EKC hypothesis has been rather mixed, and the widely-used GDP per capita is deemed an inadequate indicator of well-being. Invoking the capital theory approach to sustainable development, namely of non-declining capital stock or wealth, we test the EKC hypothesis for carbon emissions in India for the period 1972 to 2013 through the change in comprehensive wealth (i.e. comprehensive investment) and its components of anthropogenic capital and natural capital. Employing the ARDL cointegration technique, we find N-shaped EKCs with comprehensive investment, and produced capital investment, indicating rising carbon emissions in India’s current growth path. Only the increase in renewable energy resources has helped reduce carbon emissions, while the changing economic structure and foreign direct investment have had adverse environmental impact. The systematic disinvestment in natural capital through the decades reflects declining carbon sequestration capacity, and points to the need for concerted efforts to preserve natural capital like forests for essential sequestration services.