The present study examines the productive day‘s loss of local communities in the opencast coal mining region of Angul (Talcher) district in Odisha, due to respiratory illness, by using the dose-response function model. The productive day‘s loss is estimated in terms of restricted activities or work days lost, due to severe respiratory illness (RI), induced by air pollution. Health diaries are analyzed through the seasonal household survey to predict the likelihood of RI-related sickness (in terms of the restricted days) of the residents of the mining region (due to air pollution). Poisson and negative binomial regression are fitted for the purpose of count data analysis. The regression result confirms that there is a positive and significant relationship between the level of air pollution (respiratory suspended particulate matter (RSPM)/particulate matter less than 10 g/m3(PM10) and RI-related sick days, depicting that a reduction in air pollution level (PM10) may cause a reduction in expected number of RI-related sick days in the coal mining region. Further monetary welfare gain from avoiding the RI-related sick days are estimated for the population of Talcher coal mining area, Odisha.