A thick layer of toxic smog wreathed Bangladesh's capital of Dhaka on Wednesday as the air quality index plummeted into the "hazardous" category, while similar conditions prevailed in New Delhi, the capital of neighbouring India.

The air quality in Dhaka, one of the world's most crowded cities with more than 20 million people, has deteriorated as large projects spring up and fossil fuels get overused, bringing health problems for many.

"We often suffer from asthma, fever and allergies while operating rickshaws on the streets," said Rafiq Mondal, who pulls the traditional two-wheeled vehicles to earn his living. "It is often very painful."

Images from drones equipped with cameras showed smog at 9 a.m. (0300 GMT) that put Dhaka in top spot among the world's most polluted cities, with a "hazardous" index level of 325, Swiss group IQAir said.

But conditions improved slightly, with the index dropping to 177, in the "unhealthy" range, by 1.35 p.m. (0735 GMT).

City authorities spray the streets with water to help the dust settle, but residents called for greater efforts.

"The air pollution is taking its toll," said one of them, Wasim Akhter. "With all the mega projects like the metro rail overhead, there is a lot of construction material everywhere ... Measures must be taken more seriously."

In a year when smog briefly put Sydney on par with New Delhi, the World Bank has urged Bangladesh to co-ordinate more closely with neighbours in South Asia to clean up the air.

Air pollution, often a mix of solid particles, liquid droplets and gases, takes a toll of about a fifth of the country's premature deaths each year, it said in a report.

Some areas of Dhaka had levels of fine particulate matter as much as 20 times in excess of World Health Organization (WHO) standards, the report added.

In New Delhi, the Indian capital, pollution was also high, with an index reading of 378, according to the Central Pollution Control Board, for a rating of "very poor".

More than 100 flights were delayed and rail services disrupted by an enveloping fog amid temperatures of 11 degrees Celsius (51.8 degrees Fahrenheit), said news agency ANI, in which Reuters has a minority stake. (Additional reporting by Sam Jahan in Dhaka and Sakshi Dayal in Delhi; Editing by Clarence Fernandez)