SHANGHAI, Oct 2 (Reuter) - China's dirtiest city, Chongqing, suffers economic losses from air pollution equivalent to its budgetary revenue, and deaths from illnesses caused by the pollution are rising, the Press Digest newspaper said on Monday.

Chongqing, in the southwest province of Sichuan, has the worst air pollution of China's 65 cities, the newspaper said.

It also ranks among the world's top three cities with the highest acid rain levels, the Press Digest added, without naming the other two cities.

Direct losses from air pollution have reached two billion yuan ($240 million) a year, the city's budgetary income, the newspaper said.

Respiratory illnesses went from being the city's fourth largest killer in 1983 to the worst in 1993, with the death rate rising from 64 per 100,000 people to 177, it said.

Chongqing and its suburbs have a population of 15 million people. The area is a base for hundreds of factories, which make products such as cars, motor cycles, armaments and machinery.