Former International Monetary Fund (IMF) chief economist Gita Gopinath has flagged pollution as a far more serious economic threat to India than trade-related challenges, calling for the issue to be tackled on a war footing and elevated to a national priority.

Former IMF chief economist said that pollution is far more serious threat to India than tariffs

Speaking during a session at the World Economic Forum (WEF) in Davos, Gopinath said pollution often remains marginal in conversations around growth and business expansion, despite its profound economic and social consequences.

“Pollution is a challenge in India. If you look at the impact of pollution on the Indian economy, it is far more consequential than any impact of any tariffs that have been put on India so far. If you look at the annual cost to India’s GDP of the level of pollution, and it is not just the effect on economic activity, but it is also the loss of lives. The numbers are really large,” she said.

Citing a World Bank study released in 2022, Gopinath pointed out that pollution causes about 1.7 million h deaths in India every year, accounting for nearly 18% of the country’s total fatalities.

Gopinath also warned that deteriorating environmental conditions could erode investor confidence in India. “From any international investor’s perspective who is thinking of coming in and putting up a shop in India, and they have to live there and the environment is of a kind that is going to be consequential for health, it is going to hold them back,” she said. Stressing the urgency of the issue, she added, “Addressing that on a war footing is critical. This has to be a top mission for India.”

Her remarks triggered sharp political reactions. While leaders from the ruling coalition sought to distance themselves from comparisons between pollution and tariffs as economic threats, Opposition parties largely endorsed Gopinath’s assessment, describing it as timely and constructive.

Shiv Sena MP Milind Deora cautioned against conflating the two issues. “Wrong to compare air pollution with tariffs. Pollution is a serious challenge that costs lives & hurts our economy, but it’s an internal issue we must fix ourselves. Tariffs are external barriers imposed on India by another country & need to be addressed very differently,” he said.

The Congress, however, used the comments to mount an attack on the Bharatiya Janata Party (BJP). Party MP Manickam Tagore said, “Pollution choking lives, productivity & growth – IMF flags it as a bigger threat than tariffs. But wait… since this was said at WEF, next Sanghi headline loading: ‘Gita Gopinath insulted India on foreign soil’. Reality hurts more than criticism.”

Echoing similar concerns, Shiv Sena (UBT) leader Aditya Thackeray said ignoring the impact of pollution would be deeply damaging. “Thank you, Gita Gopinath, for speaking up on Pollution and its impact on the country and our economy. Being only all praise is one thing, but constructive advice that is real is needed for the genuine good of our country. Addressing pollution, climate change has become is critical today, as the social distress climate change will lead to is tremendous. Pollution is impacting daily lives and climate change is having a direct impact on livelihoods. It’ll only be a huge negative to ignore it,” he said.

HT reached out to the BJP for its response to Gopinath’s remarks, but the party has not reacted yet.