Pollution costs India $80 bn a year: World Bank

Environmental degradation costs India about $80 billion, equivalent to 5.7 per cent of the country's gross domestic product (GDP), on an annual basis according to a World Bank report released on Wednesday.

The report, Diagnostic Assessment of Select Environmental Challenges in India, focuses on particle pollution from the burning of fossil fuels, which has serious health consequences amounting to about three per cent of India's GDP, along with losses due to lack of access to clean water supply, sanitation and hygiene and natural resources depletion.

Of this, the impacts of outdoor air pollution account for the highest share at 1.7 per cent, followed by cost of indoor air pollution at 1.3 per cent.

The higher costs for outdoor/indoor air pollution are primarily driven by an elevated exposure of the young and productive urban population to particulate matter pollution that results in a substantial cardiopulmonary and chronic obstructive pulmonary disease mortality load among adults.

According to the World Bank report, India can make green growth a reality, by putting in place strategies to reduce environmental degradation at the minimal cost of 0.02 per cent to 0.04 per cent of average annual GDP growth rate.

The report analyses the physical and monetary loss of environmental health and natural resources, the trade-offs between economic growth and environmental sustainability, and provides a valuation for biodiversity and ecosystem services in India.

"Like in many other countries, the debate over growth versus environment is also active in India. This report suggests there are low-cost options that could significantly bring down environmental damage without compromising long-term growth objectives," said Onno Ruhl, World Bank country director in India.

According to the study, a 10 per cent particulate emission reduction by 2030 will lower GDP modestly, representing a loss of merely 0.3 per cent to the GDP compared to business as usual. On the other hand, a 30 per cent particulate emission reduction lowers GDP about $97 billion, or 0.7 per cent with very little impact on the growth rates.

"There are significant health benefits under both scenarios. The savings from reduced health damages range from $105 billion in the 30 per cent case to $24 billion with a 10 per cent reduction. This, to a large extent, compensates for the projected GDP loss," the report added.