Chancellor Angela Merkel walks alongside Narendra Modi, Prime Minister of India. Photo: IC

German Chancellor Angela Merkel got a toxic welcome to India on Friday as Prime Minister Narendra Modi welcomed her in air so polluted that authorities declared a public health emergency.

Ignoring medical advice to the choking megacity's 20 million inhabitants, the pair did not wear pollution masks as they inspected troops at the presidential palace in New Delhi.

Merkel, 65, sat for the national anthems, as during similar ceremonies following a series of shaking spells earlier this year.

She thanked Modi for the "very warm and gracious welcome" as the two sides signed a series of agreements in agriculture, maritime technology, "green urban mobility" and even yoga.

She and Modi also agreed to "deepen efforts to restart negotiations" on a free-trade deal between the European Union and India, with talks stuck since 2013.

The Indian pollution authority declared a health emergency after pollution levels entered the "severe plus" or "emergency" category late Thursday night - the first time since January - and ordered schools closed until Tuesday.

Especially hazardous levels of particulates smaller than 2.5 microns, so tiny they can enter the bloodstream, were 19 times the World Health Organization's safe maximum, data from the US embassy website showed. The Environment Pollution Authority also banned all construction activity in New Delhi until Tuesday and prohibited use of firecrackers during the winter season. From Monday Delhi will introduce an odd/even car licence plate scheme to cut traffic.

India is home to 14 of the 15 most polluted cities in the world, according to the United Nations. One study says that smog kills a million Indians prematurely every year.

In Delhi, smoke from thousands of farms in the surrounding region burning crop stubble combine with other emissions into a deadly, off-white fog that even hides landmarks.

The sky-high levels of pollution - making Delhi the most polluted major city on the planet on Friday according to website AirVisual - threw into doubt a cricket match between India and Bangladesh scheduled for Sunday. Bangladesh's coach Russell Domingo, bowling coach Daniel Vettori and several players wore masks on Friday. Domingo said that although a few were suffering from "scratchy eyes" and sore throats, the match would go ahead.