When the government projected the economic growth rate for the current year at 5.1pc in June against last year’s 4.14pc, it had not anticipated the devastating floods and the political agitation of Imran Khan and Tahirul Qadri.
Within the first quarter of this fiscal, both events struck the political nerve centre and food basket in Punjab, raising fears among a few economists that nothing less than 2.5pc of economic growth may be compromised. As the dust settles, these doomsday scenarios seem to be exaggerated, although it would require a comprehensive field study over the next few months for conclusive estimates.
As of September 25, the National Disaster Management Authority (NDMA) had reported that crops were affected in 2.4m acres of land and less than 8,700 cattle perished during the two-week-long natural disaster, affecting 26 of Punjab’s 36 districts. Sindh, another major contributor to GDP, faced negligible damage to crops and cattle. The infrastructure, like roads, pipelines, power plants and industrial units, remained safe.
As economists seem divided over the losses arising out of the flood, they are almost unanimous over the negligible impact of the dharnas of Imran Khan and Tahirul Qadri on this year’s GDP, notwithstanding the substantial immediate financial impact and long-term investor confidence loss.
Finance Minsiter Ishaq Dar has decided to engage multilaterals for on-ground loss estimation for credibility purposes to seek donor support for rehabilitation.
