Not just health, Delhi's air is also toxic for economy facing a slowdown

India's losses from air pollution increased more than four times to $560 billion between 1990 and 2013, according to the World Bank.

Flight disruptions, fewer tourists, lost work hours and missed school days have come to portray India’s struggles with toxic air quality in its capital city, and the intangible costs may be adding up for an economy grappling with a sharp slowdown.

India’s losses from air pollution increased more than four times to $560 billion between 1990 and 2013, according to the World Bank, which attributed the economic burden to the rising costs of public health-care and workforce disruption. Pollution is now being counted among the hidden costs like repelling top corporate talent, according to analysts and industry lobby groups.

“This feeds into the broader economic environment,” said Hemant Shivakumar, a New Delhi-based senior analyst at Control Risks that advises clients on political and security risks. “If the air pollution escalates year after year and there’s no response then it’s likely to send investors a different message.”

Prime Minister Narendra Modi’s government deployed 300 field teams to curb pollution after it reached record levels earlier this month, as winds carried smoke from farm stubble burning in areas around New Delhi. Despite the measures and the state government imposing restrictions on use of private vehicles, pollution levels remain a cause for concern in the capital city of what was until recently the world’s fastest-growing major economy.

New Delhi’s air quality index, or AQI, improved to ‘poor’ on Monday from ‘severe’ last week. A reading above 400 is classified as severe and “affects healthy people and seriously impacts those with existing diseases,“ according to the Environment Ministry.

“It affects us all,” Frank Hans Dannenberg Castellanos, the ambassador of the Dominican Republic to India and the dean of the Diplomatic Corps, was cited as saying by the Press Trust of India. “This is a problem of major proportions to be solved” by the city and the federal government.

Business Standard