article irfan mufti
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8/8/2019 Article Irfan Mufti
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EconomicCostofFloodinPakistanIrfanMufti
Withmonsoonalrainscontinuing,theworstflooding inPakistan in80years isstillspreading.Pakistani
relieforganizations
and
government
agencies
are
stretched
to
the
limit.
Yet
despite
urgent
appeals
from
theUNandotheraidorganisations,the levelof internationalaid ispitiful,evenmeasuredagainstthe
limited assistance donated in other recent disasters. The flash floods in several parts have already
damagedcountryseconomyandwill leavemarkson thecountrysagricultureandeconomicgrowth.
According to the early estimates more than 20 million people (almost 13% of the countrys total
population);including9millionchildrenaredirectlysuffering.Thisfiguredoesnotincludethosethatare
now indirectlybearingtheburden.This is inallcounts isthe largesteverwatersplash inthe64years
historyofPakistan.Themajorfloodsof1973(lessthan5millionpeople)1976(5.7millionpeople),1992
(10million),2005 (8million)and2010 (20millionaffectedpeopleasofAug15)prove thepoint.The
enormityofthedamagecanbejudgedfromthefactthat10.51peopledisplacedmorethan3000dead
(theactual
count
will
be
known
later
once
the
water
will
recede)
many
deaths
are
likely
to
be
unrecorded. In the last64yearsamongtenbiggestnaturaldisasters inPakistan that includes floods,
droughts,earthquakesandstormsthiswatertragedybyfaristhelargesteverdisasterhappenedtothis
country.
TheSwatValleyintheworstaffectedprovinceKhyberPakhtunkhwa(formerlytheNorthWestFrontier
Province)is cut off, trapping an estimated 500,000 people.Most have received no relief supplies,
exceptsmallquantitiesbeingtransportedintotheareasbyfootordonkey.Inotherpartsofthecountry,
floodingisthreateningmajorcitiesandtowns.
Atthemomentmorethan10.5millionpeopleareonthemoveontheroadsofthiscountrylookingfor
refugeand
shelter.
A
very
small
fraction
of
this
population
has
so
far
found
shelters
in
government
facilitiesortemporarycampssetupbyNGOsandphilanthropists.Majorityofthisdisplacedpopulation
isstilllivinginopenfieldsandwithoutpropershelter,food,medicinesorprotection.Mostofthemake
shiftcampsarewithoutessentialservicesandpoorlymanaged.Governmentschoolsareusedtocamp
displacedpopulationandmostofthesebuildingsarealreadyindilapidatedconditionsandcannothouse
victimsfora longtime.Thegovernmentandhumanitarianagencieshavenotbeenabletosetuptent
facilitiesthus increasingrisksofshocksandvulnerabilities.Thefood,medicines,water,nonfooditems
andtemporarysheltersprovidedbygovernment,NGOs,philanthropistsandinternationalgroupsarefar
lessthanthedemand.Itispredictedthatthetraumaisstillnotoverasmoremonsoonispredictedand
willaddmorevolumeofwaterintheriversystem.
ItissaidthatthetotalvolumeofwaterintheIndusriverwatersystemisnotexceptionallyhighforthe
river system to absorb. Thedisaster happened becauseof lack of attention tomaintenance of river
embankments, siltingof riverbeds,weakwaterprotection infrastructures,massivedeforestationand
unplannedsettlementsinriverineareas.Allthesefactorscontributedagreatdealintheongoingordeal
ofthepeople.Levelofpreparednesstocopewiththe impendingdisasterwasvery low.Thoughthere
are severaldisastermitigationandmanagement systemsandauthorities setup in last fewyearsbut
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theirperformanceisfarbelowthanexpectedstandards.Ironicallymostofthepeoplethatwereeither
forced to leave houses unalarmed orwith prior notice did not knowwhere to go for shelter, food,
medicines and other basic facilities. No government information facilities were setup or prior
arrangementswere ensured.Mass exodus from flooded cities further chokednationalhighways and
nearbycitiesandtowns.
Tragicallythefloodhitthemostfertilefoodgrowingareas.Gilgit,Swat,Charsada,Swabi,Nowsherato
Larkana,DaduandMatiariare food growingpockets and contribute a reasonable share in countrys
foodandgraineconomy.Major lossesofcrops,orchards,cattle, fodder,cottonandothermajorcash
cropswillhaveaserioussetbackontheeconomy.Thiswillcreatefoodscarcityandinsecurityformany
in comingmonths. Some of these crops are export oriented and countrywill face decline in export
earnings.
Flood also causeddestruction to railwaynetworks, roads,barrages, canals, village infrastructure and
otheressentialfacilitiesinthecatchmentareas.Transportationofgoodsandpeopleisalreadyeffected.
Ithasalsodestroyedbuildings,factories,warehousesetcandcloseddownworkintheseplacesdueto
which not only the workers will suffer but also the industries will suffer. In coming months the
government has to invest huge amount of funds and manpower in rehabilitation of people and
industries,whichwillcausetheeconomytosufferatthenationallevel.
Themassdisplacementofpopulationwillirkcitiesscarceresourceandloadnearbytowns.Thoughmost
ofthepeoplethataredisplacedareskilledagriculturelaborandcanbeadjustedasunskilledlaborerin
othersectorsbutitthelaborinagriculturesectorwillbescarce.
Inpreviousyearsthefloodsdamages/lossasapercentageofthetotalGDPvaluewassignificantduring
followingyears.LossaspercentageofGDPvaluewas3.04 in1973,5.09 in1976and2.60 in1992. If
damagedue
to
cyclones
and
storm
surges
were
taken
into
account,
the
overall
loss
as
apercentage
of
GDPwouldbemuchhigher.ItmaybenotedthattheGDPvaluesareatconstant1985prices.Estimates
oftheeffectoffloodlossontheGDParebasedonstaticabsolutefiguresoffloodloss.Thestructuresof
the flooddamage lossesand their relativeweightage to totalGDPhavenotbeen taken intoaccount.
However, the estimates provide a notional indication of the impact of flood damage/loss on the
economy.
ItmaybementionedthatfloodscauselossesbothtotheGDPandtothecapitalstockandthushamper
thegrowthpotentialofthecountry.Moreover,theselossesalsohavelongtermimpactsonthemacro
economy.The longterm impactswillbe twofold:capitaldamages inducea lowerGDP in subsequent
years
(to
the
extent
of
investment
losses);
and
output
losses
(caused
during
the
flood
affected
year)
lowerincomesandpossibly,reducesavingsavailableforfinancinginvestments.
Inaddition,therewillbeenormoussocial lossesduetothisflood,the impactofwhichonthemacro
economyismuchmorethanmicroeconomiclossesintermsofacceleratingthegrowthpotentialofthe
economy. However, as yet there is no comprehensive source that provides information/analysis of
possiblemacroeconomicimpactofcurrentfloodlosses.
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ThegovernmentwasalreadyfacingwidespreadhostilityoveritsproxywaronbehalfoftheUSagainst
Islamistmilitants,and the countryseconomicand social crisis.Now the floodshavewipedout large
areasof crops,destroying the livelihoodsofmany farmersand leading tohigher foodprices.As the
floodingworsens,angerandprotestswillinevitablyspread,compoundingthecrisisofafragileregime
Despitethe
immense
scale
of
the
disaster,
international
aid
is
only
trickling
in.
As
of
early
this
week,
accordingtotheUNsfinancialtrackingsystem,thefundscommittedbygovernmentstotaledlessthan
$US45million,withanadditional$91millionpledged.
Thegovernmenthasso far failed tomobilizeexternalanddomestic resources tomanage theeffects.
Thisdelaywilllimitgovernmentabilitytorestorehumansettlements,rehabilitateagricultureandrural
economy, rebuild infrastructure, provide safe and timely return and recovery of these people and
reduce strain from urban centres. All thesewill be contributing factors inmultiplying shocks of the
disaster.Governmentcredibilitydeficitand lackoftrustoffunders isworrisomefactor.Thesheersize
and scale of devastation requires much higher level of support failing to which will weaken the
governmentscapacitytodealwiththedomestic issuesmainlyterrorism,recession, inflationandhigh
scale of unemployment. It is much needed that all stakeholders including donors, investors,
humanitarianassistanceorganizations,aidconsortiumsandothereconomicpowersmust invest inthis
timeofcrisistoavoidanyunduespilloverofthissituation.Itisneededthatgovernmentinvitesallkey
stakeholders to aplatform anddevelopdisastermanagementplanwith greaterparticipationof civil
societyandeffectees.Allemergency,relief,earlyrecovery,rehabilitationandresettlementeffortsmust
bedoneoutside theambitofusualgovernmentstructures.Onlyan independentcommission leadby
crediblepersonalitiescanensuregreaterparticipation,trustandoptimumresultsoftheseefforts.
In themeantime the governmentmustdemonstrate its politicalwill to support. Ithas to put these
peopleasitsfirstpriorityandshiftothergovernmentagendasinthesecondlist.Sofarthegovernment
hasfailed
to
show
its
resolve
and
leadership
in
tackling
the
problem.
The
present
disaster
will
also
be
a
test forthepresentpoliticalgovernmentasmosteffecteesarealsothevotersoftherulingpartyand
rightlyexpectingurgentandsubstantivesupport.Governmenthastocutdownonitsexpenses,mainly
nondevelopmentexpendituresanddiverttheseresourcestothemuchneededreliefandrehabilitation
of these20millionpeople.Failing towhichwillhaveserious repercussions for thecountryaswellas
presentgovernment.