Does air pollution cause diabetes, or does pollution cause vitamin D deficiency, which then leads to diabetes?
New research from Germany showed that women who lived in heavily air-polluted areas were at greater risk for type-two diabetes than those who lived in less-polluted areas. Those who lived within 100 meters of busy roadways doubled the diabetes risk. http://www.newswise.com/articles/study-suggests-link-between-air-pollution-and-type-2-diabetes-in-women
The authors assumed that the inhalation of pollutants was responsible for the increased risk of diabetes among those living in heavily-polluted areas, but I suggest another possibility: It is well-known that air pollution filters out sunlight and correlates to profoundly lower vitamin D levels.   
But do vitamin D levels have an influence on type-two diabetes? Research shows that Vitamin D levels correlate closely to insulin sensitivity; the higher the vitamin D levels, the more receptive the body is to the action of insulin, which makes carbohydrates easier to metabolize. This same study shows that the higher the vitamin D levels are, the lower are the blood sugar levels. Other research shows that men with the highest vitamin D levels had a 30% reduced risk of type-2 diabetes compared to those with low levels, probably because the beta cells of the pancreas (the insulin producing cells) have vitamin D receptors and function more efficiently when vitamin D levels are higher.
It is highly likely that the reason for the increased risk for diabetes was not the inhalation of air pollutants, but rather the lack of sunlight and subsequent vitamin D deficiency. It is time to leave the pollution and return to the sun.
 Mims FM., 3rd Significant reduction of UVB caused by smoke from biomass burning in Brazil. Photochem Photobiol. 1996 Nov;64(5):814–816.
 Agarwal, K et al. The impact of atmospheric pollution on vitamin D status of infants and toddlers in Delhi, India. Arch Dis Child 2002;87:111-113
 Holick MF. Environmental factors that influence the cutaneous production of vitamin D. Am J Clin Nutr 1995;61:(Suppl):638S-645S.
 Chiu K. et al. Hypovitaminosis D is associated with insulin resistance and beta cell dysfunction. Am J Clin Nutr 2004;79:820-25.
 Mattila, C. Serum 25-hydroxyvitamin D concentration and subsequent risk of type-2 diabetes. Diabetes Care 2007;30:2569-70.
 Brown, A. et al. Vitamin D. American J of Physiol 1999;277(2 Pt 2):F157-75.
 Norman, A. et al. Vitamin D deficiency inhibits pancreatic secretion of insulin. Science 1980;209:823-25.