Air pollution costs Indian business about Rs 7 lakh crore annually

The report also states that India had 1.7 million premature deaths from air pollution in 2019
Representative image
Representative imageImage source: Unsplash

New Delhi: Air pollution costs Indian business about USD 95 billion (7 lakh crores) every fiscal year, around 3 per cent of India’s total GDP, a major research report shows. The findings in the report, undertaken by Dalberg Advisors in partnership with Clean Air Fund and the Confederation of Indian Industry (CII) add urgency to tackling air pollution by outlining that it imposes heavy economic costs as well as devastating health impacts.

The cost is equal to 50 per cent of all tax collected annually, or 150 per cent of India’s healthcare budget.


Dalberg estimate that India’s workers take 1.3 billion days off work annually because of the adverse effects of air pollution on their health, amounting to USD 6 billion in lost revenue. Air pollution has also been shown to have significant effects on workers’ cognitive and physical performance, lowering their on-the-job productivity and thereby decreasing business revenues by up to USD 24 billion.

Further impacting the national economy, the report found that lower air quality also reduces consumers’ willingness to venture out of their homes, leading to lower footfall and ultimately USD 22 billion less revenue for consumer-facing businesses.

India had 1.7 million premature deaths from air pollution in 2019, 18% of all deaths in India, a figure that is projected to increase by 2030, making India a major contributor to the global economic cost of premature mortality. India has grown to become the world's fifth most polluted country in the last decade and has 21 of the world's 30 most polluted cities.

Speaking at the launch of the report, Gaurav Gupta, Partner, Asia Director, Dalberg, said, “This report shows how air pollution affects the overall health of businesses and the economy. While the government has taken aggressive measures to address the issue, the emphasis on air pollution across the globe has continued to be on its public health implications. It has now become important for Indian business to include air emissions in their profit and loss statements.”

The report notes that air pollution has a substantial impact on India’s economy, alongside the health and environmental impact and that by improving its air quality, India will not just be healthier but also wealthier.

Seema Arora, Deputy Director General, CII, said, “As per the survey insights, interviews and data analysis that went into the preparation of this report, it is clear that individual businesses – and their employees – have a direct stake in improving air quality. While there is a need of a lot of thinking to be done here, the business solutions to this business crisis as per our findings include ‘’greening’’ business operations and supply chains, adopting renewable energy technology, mitigating emissions through CSR activities, and campaigning for more ambitious pollution policies.

“We believe that through active and sustained collaboration between the public and private sectors, bluer skies and a healthier economy can soon become India’s reality,” she concluded.

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