Breathing easier: Making clean air affordable for everyone

Infograph: TBS

Air pollution in Bangladesh constitutes a major public health challenge, with Bangladeshi cities frequently featuring among the most polluted globally. In 2023, Dhaka's air pollution levels were 16 times higher than the WHO recommendations, and The Energy and Policy Institute at the University of Chicago estimates that an average resident in Dhaka loses 5.6 life years due to air pollution. 

While considerable attention is rightfully paid to outdoor air quality, the quality of indoor air, where individuals spend the majority of their time, warrants equally serious consideration. Our research indicates that the indoor air in Bangladeshi homes has 77% of the outdoor levels of pollution. 

Unfortunately, the typical household is not aware of the poor air quality inside their own home. An average household thinks that their home has only 43% of the pollution of outdoor air pollution.

The health implications of poor indoor air quality are substantial, contributing to respiratory and cardiovascular diseases among other health issues. Economically, the consequences manifest as increased healthcare expenditures and reduced productivity due to illness-related work absences. Thus, improving indoor air quality emerges not only as a public health imperative but also as an economic strategy to enhance national productivity. 

Air purifiers, which can effectively reduce indoor pollutants by approximately 80% when utilised properly, represent a viable technological solution to this issue. However, the adoption rate of air purifiers in Bangladesh remains low. 

We conducted a survey with over 1,000 households in a middle-class neighbourhood in Mirpur, and we found that less than 1% owned an air purifier. We also measured households' willingness to pay for an air purifier. We found that households on average are willing to pay only Tk1,428 for a purifier, while the retail sales price at that time was around Tk16,500.

One reason for the high cost of air purifiers is that they are subject to a 74% import duty (which is comprised of customs duty, supplementary duty, advance income tax, regulatory duty, etc.) on top of the regular 15% VAT. This means that the same air purifier costs Tk16,500 in Bangladesh but only the equivalent of Tk12,520 in India or Tk14,662 in the Philippines.

If duties on air purifiers were cut from 74% to 16% (the excise duties levied on medical or surgical furniture), the price would fall from 16,500 to approximately 11,000. Our research with households in Dhaka shows that this decrease in price would result in 250% more households willing to buy air purifiers. 

While this would still be a very small share of the population, we believe that as more households start using purifiers, this will educate the whole population about both the severity of the problem of indoor air pollution as well as the effectiveness of air purifiers. The economic rationale for reducing these taxes is supported by the potential reduction in healthcare costs and the improvement in worker productivity that cleaner indoor air would facilitate. 

In conclusion, there is a compelling economic and public health case for reevaluating the tax structure on air purifiers in Bangladesh. Reducing these costs represents a proactive approach to a pervasive health issue, aligning with broader economic interests by potentially lowering healthcare costs and enhancing productivity. 

Furthermore, by educating the population about the severity of indoor air pollution as well as the effectiveness of air purifiers, we can make air purifiers a common feature of modern Bangladeshi homes, just as other health technologies such as water filters.

Martin Mattsson is an Assistant Professor at the National University of Singapore, Teevrat Garg is an Associate Professor at the University of California, San Diego, Maulik Jagnani is an Assistant Professor at TUFTS University, Ashfaqul Haq is a Senior Country Economist at the International Growth Center and ARM Mehrab Ali is the Executive Director of ARCED Foundation. 

Disclaimer: The views and opinions expressed in this article are those of the authors and do not necessarily reflect the opinions and views of The Business Standard.