The Cheat Sheet

The bad, bad economics of air pollution

JINOY JOSE P | Updated on January 13, 2018


I can see some suffocating numbers there!

Indeed. The latest set of numbers on the human cost of air pollution comes from the State of Global Air Report 2017, prepared by the US-based Health Effects Institute and the Institute of Health Metrics and Evaluation. The report says bad air killed around 4.2 million people in 2015. And that’s a leap from the 3.5 million in 1990. Shows things have got really, really worse. The report says air pollution kills, hold your breath, some 1.1 million people each year in India and China.

Gosh! This isn’t a record to be proud of!

You said it! The sad part is, while China seems to have been able to control deaths of people who regularly inhale particulate matter with a diameter of less than 2.5 microns or PM2.5, India is ‘growing’ on that front, thanks to lax rules, corporate apathy and a lethargic public. And the story doesn’t end there.

What’s more?

The US report says deaths from, say, bronchitis and emphysema — Chronic Obstructive Pulmonary Disease or COPD — have also gone up in India and other developing countries. Between 1990 and 2015, India posted a 150 per cent increase in annual deaths from COPD, which is a result of ozone exposure. And we don’t have the company of China there. Their numbers haven’t changed much during this period.

Lives don’t matter in this wretched place, I guess.

Quite so. Policymakers seem to be in wondrous oblivion when it comes to formulating stringent rules to ensure good air in our atmosphere. Nor is there political will and administrative alacrity in implementing whatever laws we have in letter and spirit. This forms a deadly cocktail and polluters go on emitting killer particles. Given the way India is embracing industrialisation and how companies are relying on energy sources such as coal, things have come to a terrible pass.

What’s the remedy?

Policymakers and businesses must understand the real economic costs of air pollution. Sometime ago, country bloc OCED projected that air pollution is likely to kill more than 9 million people by 2060, and the market impacts of such a calamity will be over 1 per cent of global GDP by then. OECD has had an alarming forecast: the global welfare costs of premature deaths from outdoor air pollution may be around $25 trillion in 2060. The costs of “pain and suffering” from illness may be around $2.2 trillion by 2060.

Big numbers!

Now, over to the World Bank. In 2013, a study the global lender had sponsored found that deaths from air pollution cost the global economy about $225 billion in lost labour income. Its report found that annual labour income losses cost the equivalent of about 1 per cent of the total GDP in South Asia. Estimates show about 90 per cent of the people living in low and middle income countries face alarming levels of ambient air pollution. World Bank estimates have also shown that in 2013 welfare costs and lost labour income from air pollution cost 8.5 per cent of India’s GDP.

So, what are the immediate policy measures we must undertake?

We can always start with offering incentives for clean technologies and implementing stricter standards for emissions and fuel quality. The Government must create an air-pollution index and rate cities and States regularly and release the data in public domain. It can also regulate the flow of capital into these States and cities based on their performance on the API. A similar index can rate firms based on carbon footprint and clean technology practices. This data should be vetted regularly using third-party agencies and made available real-time for public audit. These are important because toxic air spares none.

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Published on February 15, 2017

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