Flood loss estimates rise to $43bn: PM
ISLAMABAD: The federal cabinet was informed on Wednesday that economic losses inflicted by the floods were estimated at $43 billion, almost equal to the expenditures incurred on the war on terror over the past nine years.
The floods have affected 79 of the 124 districts — 24 in Khyber Pakhtunkhwa, 19 in Sindh, 12 in Punjab, 10 in Balochistan and seven each in Azad Kashmir and Gilgit-Baltistan.
Prime Minister Yousuf Raza Gilani said the government had released massive funds to the provinces under the 7th National Finance Commission Award and relief funds would be disbursed after the Council of Common Interests evolved a mechanism.
He said the national economy had grown by 4.1 per cent last year and was expected to grow four per cent this year, but it might end up at 2.5 per cent, causing massive job losses and affecting incomes of thousands of families.
The prime minister said the devastation might also affect revenue collection and increase expenditures, widening the budget deficit.
It would hit the textile and sugar sectors and in turn affect the balance of payments and external resource stability, he said.
Mr Gilani said growth of the manufacturing sector might fall far below the target of 5.6 per cent.
He also said that inflation might increase to 15-20 per cent, much more than the 9.5 per cent target.
Inflation in the short term (one to three months) may rise significantly because of reduced supply due to crop destruction.
The prime minister said a meeting of the CCI had been convened on Friday to prepare a national strategy for rehabilitating the affected people in consultation with the provinces.
Briefing journalists after the cabinet meeting, Information Minister Qamar Zaman Kaira said 20 million people had been affected and 7.5 million of them had been displaced.
United Nations agencies and the National Disaster Management Authority estimate that crops over 1.38 million acres have been washed away and 1.2 million homes destroyed.
The damage to infrastructure, livestock and crops amounts to Rs350-500 billion
About $200 million will be needed for recovery and relief work and over $1 billion to repair key infrastructure.
Reconstruction of about 1,000 damaged bridges and over 400km roads will cost Rs8-9 billion.
About one-fifth of the irrigation infrastructure, livestock and crops in the country has been destroyed. According to initial estimates, the Pakistan Electric Power Company has suffered a loss of Rs4 billion to its installations. The cumulative losses of the Water and Power Development Authority and Pepco exceed Rs13 billion.
About Rs2 billion has been collected in the PM’s Relief Fund and $953.7 million has been pledged by donors, of which $142.47 million has been received.
BANKNOTES: The cabinet also approved replacement of Rs5 banknotes with coins and demonetisation of the Rs500 note of old design.
It decided to renegotiate and agreement with Australia on promotion and protection of investments.
The cabinet approved a bill for setting up the Shifa Tameer-i-Millat University in Islamabad.
APP adds: The prime minister said the job and income losses as a result of the floods might have serious social implications.
He said 30 per cent agricultural land and more than 10pc of the population had been affected.
He said the floods had caused the largest number of displaced people since the country’s independence and affected more people than all recent major disasters throughout the world.
He said the agriculture sector might face the adverse effect for another year.
Food security of the country was also under threat, he said.
