The 'Mercer 2015 Quality of Living rankings' evaluated local living conditions in more than 440 cities around the world for the assessment that placed Vienna on top.
"Hyderabad (138) and Pune (145) rank higher for quality of living than the country's more traditional business centres, Mumbai (152) and New Delhi (154).
"Considerable population increases in Mumbai and New Delhi in recent decades have increased existing problems, including access to clean water, air pollution and traffic congestion," the report said in its assessment for India.
Vienna topped the charts as the world's best in terms of quality of living, followed by Zurich, Auckland, Munich and Vancouver in the top five.
Also Read
Overall, European cities dominate the top of the ranking, with Singapore (26) the highest-ranking Asian city, whereas Dubai (74) ranks first across the Middle East and Africa.
Montevideo in Uruguay (78) takes the top spot for South America.
The Mercer rankings are based on assessment across 10 categories, including political, economic and social environment as well as housing and medical provisions.
"Employers need to assess whether their staff and families will encounter any drop in quality of living when relocating and ensure they are fairly compensated for it," explained Parakatil.
In the UK, London (40) is the highest ranked followed by Birmingham (52) and Glasgow (55).