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Degradation = decrease of quality. This can either happen naturally (e.g. erosion, landslides, forest fires, floods) or man-made (pollution).

Pollution = the contamination of nature (air, soil, water) with harmful substances. Can occur naturally (volcanic eruptions) or man made (toxic gas release, industrial effluents)

The difference of both is that degradation implies 'a decline of quality from its pure state' while pollution is 'the action that causes degradation'. Yes, pollution is one of the causes of degradation.

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