India’s air pollution crisis is increasingly becoming a workplace and urban-economy problem, with a new report estimating that dirty air cost the country around $260 billion in 2024. The damage is not limited to hospital bills or employees taking sick leave. It also includes workers who remain on the job while coughing, fatigued or struggling to concentrate, alongside consumers who reduce shopping, dining and travel when pollution levels rise.
The report by Dalberg Advisors and the Clean Air Fund estimates that the economic cost of air pollution was equivalent to roughly 6 per cent of India’s gross domestic product in 2024. It brings together losses associated with reduced worker productivity, premature mortality, healthcare expenditure, absenteeism and lower consumer activity. Its central contribution is to make visible the economic effects that are often dispersed across company records, household budgets, public healthcare spending and city-level business activity.
That dispersion matters because air pollution does not present itself as one conventional business expense. A company may record sick leave, medical reimbursements or staff replacement costs, but it may not identify the productivity lost when an employee works while unwell. The report describes this condition as presenteeism: employees are physically present but unable to perform at their normal level because of health problems.
Dr Gowri Kulkarni, Director of Doctor Relations and Head of Medical Operations at MediBuddy, told NDTV that employers often notice when a worker takes sick leave but may miss the effect of someone who continues working with a cough, breathing difficulties, headaches or constant fatigue. Presence, in this context, is not the same as full productivity.
The distinction is particularly important in sectors that depend on concentration, skilled labour and consistent output. A small decline in individual performance may be difficult to identify, but the report estimates that presenteeism accounts for the largest share of India’s economic losses linked to air pollution. Spread across a large workforce, these losses can become significant even when no single workplace records a dramatic disruption.
The five channels identified in the report—presenteeism, absenteeism, premature mortality, healthcare expenditure and reduced consumer spending—also show why air pollution belongs in urban economic planning rather than only in environmental or medical policy. Each channel operates through a different part of the city. Workplaces absorb lost output, households and insurers face medical costs, employers manage absences, and commercial areas lose activity when people avoid spending time outdoors.
Healthcare expenses alone were estimated at $12.3 billion in 2024. The report says this figure includes costs borne by governments, households and private health insurers. Pollution-related illnesses can also result in employees missing work, leaving colleagues to cover responsibilities and disrupting normal schedules. These costs are distributed across institutions, which can make the broader burden harder to attribute to the pollution exposure that caused it.
The consumer economy provides another urban link. According to the report, reduced consumer spending and tourism activity cost India around $74 billion in 2024. When pollution levels rise, people may avoid shopping, dining out and travelling. This affects retailers, restaurants and tourism operators that depend on footfall, as well as the workers and local businesses supported by that activity.
The numbers therefore describe a feedback loop within cities. Polluted air can affect workers’ health and performance, reduce household and consumer activity, and increase healthcare spending. Lower activity then affects businesses whose revenues depend on people moving through commercial districts and public spaces. The supplied report does not establish that every reduction in spending is caused solely by pollution, but it identifies pollution-related avoidance of outdoor activity as a significant component of the estimated economic loss.
The report’s proposed economic gains from cleaner air are similarly expressed at national scale. It estimates that reducing India’s PM2.5 pollution by around 20 per cent could help avert approximately $85 billion in annual economic losses by 2030. The largest gains would come from improved worker productivity and restored consumer activity, with lower healthcare spending and fewer pollution-related absences adding to the benefit.
It also estimates that achieving safe PM2.5 levels could unlock around $260 billion in annual economic gains over the longer term. The supplied material does not specify a detailed implementation pathway, funding structure or division of responsibility between central, state, municipal and workplace authorities. That limitation is important: the report provides an estimate of the economic opportunity, while the institutional mechanisms required to achieve it are not detailed in the information available here.
The workplace response described in the report covers both indoor and outdoor environments. Dr Kulkarni said protective measures should include better ventilation, HEPA-filter air purifiers, well-fitted N95 or N99 masks for field employees, regular health check-ups and access to medical advice. These measures address exposure at the point where people work, but they do not replace city-wide action to reduce pollution at source.
The distinction between indoor and outdoor workers is especially relevant to construction, logistics, delivery and other occupations that require prolonged exposure outside. These employees cannot simply shift their responsibilities indoors or work remotely. Their exposure is shaped by the conditions of streets, worksites and transport routes, making air quality a question of occupational health as well as urban infrastructure and labour protection.
For office-based employers, the challenge is easier to overlook because the loss may appear as reduced concentration rather than absence. For outdoor workers, exposure is more direct and the ability to avoid it is more limited. The report’s framing consequently moves the conversation beyond whether a city’s pollution is visible on a particular day. It asks how repeated exposure affects the reliability of the workforce and the functioning of the urban economy over time.
The evidence supplied by NDTV does not provide city-by-city estimates, sector-wise productivity losses or a breakdown of the $260 billion figure across all five channels. It also does not establish whether companies are systematically measuring presenteeism. Those gaps prevent a more precise assessment of which industries, cities or worker groups bear the greatest share of the cost. What the report does establish is the scale of the national estimate and the multiple pathways through which pollution affects economic activity.
That is the larger urban question: whether air quality is being treated as a temporary environmental emergency or as a continuing condition that shapes how cities work. The report’s figures place pollution inside the balance sheet of businesses, households, governments and insurers, even when the accounting systems of those institutions do not record it under one common heading.
Cleaner air, on the evidence presented, would not only reduce illness. It could also protect working capacity, reduce avoidable healthcare expenditure and support consumer activity. The immediate uncertainty lies in how the estimated gains would be distributed and which authorities or employers would be responsible for delivering them. For now, the report makes one conclusion clear: the cost of polluted air is being paid well beyond the hospital, including in workplaces, commercial districts and the everyday functioning of Indian cities.
