Floods in Pakistan cause economic loss to the tune of USD 12.5 billion

The estimated economic loss to Pakistan from floods has increased from USD 10 billion to USD 12.5 billion.

Inflation is projected to go up to the range of 24 percent to 27 percent and will touch 30 percent for the current fiscal year, reported Geo News.

Moreover, poverty and unemployment will go up manifold from 21.9 percent to over 36 percent. A high-profile committee with representation from the Ministry of Finance, Ministry of Planning, State Bank of Pakistan, FBR, PIDE and others, made the evaluation.

The unemployment rate stood at 6 percent before the recent severe floods. Some 37 percent population has been hit by poverty after floods in 118 districts, as estimated by the Pakistan government.

Official sources said that the GDP growth would be reduced from 5 percent to 2 percent for the current fiscal against the initially envisaged growth rate target of 5 percent.

The State Bank of Pakistan revealed that growth would be reduced from 4 percent to 4.5 percent to 2 percent for the current fiscal, The News reported.

Agriculture growth faced a much more severe impact in the aftermath of floods and the value addition of agro growth in the range of over Rs 500 billion might evaporate in the current fiscal year. The agriculture growth target and services sector faced severe impacts.

The acute losses on the economic front may aggravate as the SBP’s model is estimated to ascertain losses on the basis of disrupted economic activities hit in all districts and tehsils in the flood-affected areas.

The SBP has been using satellite images of SUPARCO to assess the exact losses faced by the agriculture sector. Google has also offered the government its services to ascertain the total accumulated losses to agriculture and physical infrastructure.

The last flood that hit the country in 2010 had caused damage in 78 districts but the current floods hit as many as 118 districts.

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