The Pulse | Economy | South Asia

Extreme Heat Is Hurting South Asia’s Economies. Here’s How Much.

Multiple reports highlight alarming loss of wages and work hours due to extreme heat.

Exposure to extreme heat is costing the South Asian workforce a significant chunk of their pay every year, a series of recently published reports show. The single largest economic cost of heat comes from labor productivity losses, but there are other factors as well. A report from the World Bank predicted that South Asia’s regional GDP could be reduced by nearly 7 percent by 2050 if no adaptation measures are taken.

A recent report from Bangladesh, which is based on interviews with 175 households engaged in informal work such as construction, rickshaw pulling, and garment manufacturing, found that outdoor workers lost about 8.5 percent of their annual income, as they lost roughly 24 working days a year. Indoor workers lost 14 working days and 4.5 percent of their annual income. For both groups, illness caused by heat and reduced productivity are the largest causes of workdays lost.

The report, titled “No escaping the heat: Health and economic impacts of heat stress on informal workers in urban Bangladesh,” estimates the nation is losing about 0.9 percent of its GDP due to workday losses. That figure further increases if the cost of kidney-related ailments due to frequent dehydration is taken into account. Workers reported low mood, mistakes at work, anxiety, and irritability, as well as difficulty sleeping.

The London-headquartered International Institute for Environment and Development (IIED) conducted the study jointly with the Dhaka-based Ovibashi Karmi Unnayan Program (OKUP). The report comes close on the heels of two other publications that point to similar findings for the South Asian region.

A July 2026 report by IIED said India’s nationwide cost of heat-related kidney problems, combined with employees’ reduced ability to work during heatwaves, is estimated to be $78 billion in lost wages – equivalent to 1.99 percent of India’s GDP in 2024. Based on a survey conducted on 538 informal worker households in three Indian cities, Ajmer, Delhi, and Agra, the IIED study found a picture very similar to that of Bangladesh.

Those in outdoor industries like construction, road laying and brickmaking lost about 24 days of work annually due to heat, costing them the equivalent of $151 — nearly a tenth of their annual earnings. Indoor workers engaged in food packaging, garment manufacturing, and stonemasonry lost roughly 15 days — the equivalent of $89.

The overall loss of work hours translates to a massive scale of lost employment opportunities. Regarding South Asia, a World Bank report, titled “A Livable Future: Tackling Extreme Heat for Jobs and Growth in South Asia’s Cities,” published at the end of July, said that extreme heat “already subtracts the equivalent of 31 million full-time jobs a year across the region.”

The report examines how urban heat threatens the job market in Bangladesh, Bhutan, India, the Maldives, Nepal, and Sri Lanka. It estimates that, on average, rising temperatures will lower labor productivity in South Asia by 11 percent below the baseline by 2050. This is the largest estimated loss for any emerging market and developing economy region.

As another 2026 report on South and Southeast Asian cities, titled “Hot Cities Make Hard Work Harder,” points out, even in a Himalayan city like Nepal’s Kathmandu, 85 percent of respondents reported wage losses and increased healthcare expenses due to extreme heat. In........

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