Inspiration is the process during which the atmospheric air is taken in.

Mechanism

The diaphragm and the set of intercostal muscles aid in the process of inspiration. The diaphragm contracts, thus increasing the volume of the thoracic cavity in the antero-posterior axis. The intercostal muscles also contract and lifts the ribs up further increasing the volume in the dorso-ventral axis. This creates a negative pressure in the lungs with respect to the atmospheric pressure. The air rushes in to equalise the pressure. 

Hypoxia - is a condition in which the body or a region of the body is deprived of adequate oxygen supply at the tissue level. It is caused by several extrinsic factors such as reduction in pO2, inadequate oxygen, etc.

Hypoxia may be classified as either generalised, affecting the whole body, or local, affecting a region of the body.

pCO₂ has a major role in the transport of oxygen. 
Low pCO₂ and high pO₂ favours the formation of haemoglobin. At the tissues, the high pCO₂ and low pO₂ favours the dissociation of oxygen from oxyhaemoglobin. Hence, the affinity of haemoglobin for oxygen is enhanced by the decrease of pCO₂ in blood. Therefore, oxygen is transported in blood as oxyhaemoglobin and oxygen dissociates from it at the tissues.