Pollution poses a more serious long-term risk to India’s economy than tariff-related challenges, former IMF Chief Economist Gita Gopinath said at the World Economic Forum in Davos, urging policymakers to treat environmental degradation as a central economic concern.
Speaking at the global forum, Gopinath underlined that the costs of pollution go far beyond environmental damage, directly affecting productivity, public health and economic growth. She said the impact of degraded air, water and land is increasingly visible in economic outcomes, particularly in fast-growing countries like India.
“The real costs of pollution are not merely environmental; they are deeply intertwined with economic growth, productivity and the health of citizens,” she said, stressing that addressing pollution must become a priority for safeguarding India’s economic future.
Her remarks came amid heightened global uncertainty, with markets facing volatility and shifting trade dynamics. While tariffs and trade barriers remain relevant, Gopinath argued that environmental stress is emerging as a more persistent and systemic threat to economic stability.
The Davos discussions this year have placed strong emphasis on sustainability and climate risks, reflecting a broader consensus among economists that unchecked environmental damage can undermine development gains. Experts have long warned that climate and pollution-related shocks could have outsized economic consequences in emerging economies.
India continues to face scrutiny over air quality and rising pollution levels, which have significant public health implications and can impede growth. Global health agencies estimate that polluted air contributes to millions of premature deaths each year, with India among the most affected countries.
Gopinath cautioned that as the world navigates post-pandemic recovery, economies are likely to experience greater instability in markets, currencies and growth trajectories. She said how nations respond to environmental challenges will play a decisive role in shaping their economic futures.
