Finance
According to local media, the catastrophic floods in Pakistan have caused economic damages ranging from $10 billion to $12.5 billion, in addition to the loss of lives, with the government projecting an increase in inflation ranging from 24-27 percent to 30 percent for the current fiscal year.
A high-level committee comprised of representatives from the Ministries of Finance and Planning, the State Bank of Pakistan, the FBR, PIDE, and others determined that poverty and unemployment had increased dramatically, rising from 21.9 percent to more than 36 percent.
According to Geo News, 118 districts of the country were ravaged by severe flooding, affecting 37% of the population.
Unemployment has increased significantly, but the government has decided not to share any figures until it has held consultations with relevant stakeholders. Prior to the recent severe floods, the unemployment rate was 6%.
According to official sources, GDP growth for the current fiscal year will be reduced from 5% to 2%. According to The News, the State Bank of Pakistan revealed that growth for the current fiscal year would be reduced from 4% to 4.5% to 2%.
Agriculture growth was severely harmed in the aftermath of the floods, and the value addition of agro growth in the range of Rs500 billion could be lost in the current fiscal year. Agriculture’s growth target and the services sector’s growth target faced severe impacts.
The country’s GDP growth is expected to shrink by 3%, hovering around 2% of GDP on the eve of the budget for 2022-23, compared to the initially anticipated growth rate target of 5%.
The acute economic losses may worsen as the SBP’s model is estimated to calculate losses based on disrupted economic activities in all districts and tehsils in flood-affected areas. The SBP has been assessing the agricultural sector’s exact losses using SUPARCO satellite images. Google has also offered to help the government calculate the total accumulated losses to agriculture and physical infrastructure.
The previous flood that hit the country in 2010 caused damage in 78 districts, but the ferocity of the recent floods can be gauged by the fact that it caused damage in 118 districts of those areas, which are major economic hubs.
Source:OCN
