ISLAMABAD: Pakistan’s GDP growth for fiscal year 2025-26 may plunge to between zero and one percent against the International Monetary Fund (IMF)’s forecast of 3.6 percent, as devastating floods threaten to cripple agriculture and push inflation higher.
This was stated by former finance minister Dr Hafeez Pasha while speaking at Aaj TV talk show “Paisa Bolta Hai” with Anjum Ibrahim on Sunday.
The government has set GDP growth target of 4.2 percent for the current fiscal year 2025-26.
Food supplies at risk due to floods: FD warns Pakistan’s economy faces renewed challenges
Dr Pasha said it was not possible for growth to touch the targeted 3.6 percent given widespread crop losses. “In 2022-23, growth was negligible due to floods. A similar situation is unfolding now, with agriculture set to take the biggest hit.”
The economist recalled that the 2022 floods inflicted losses of nearly USD 30 billion, damaging 7–8 percent of GDP. “This time too, the economy is at risk of being dragged down to zero growth unless other sectors recover strongly,” he added.
Dr Pasha warned of surging inflation, food shortages, and a sharp rise in the prices of essential commodities. He lamented that despite being battered by major floods every three to four years, Pakistan still lacks a precautionary or anticipatory investment strategy to mitigate the fallout.
Highlighting fiscal pressures, he said the budgetary framework for fiscal year 2025-26 stands fundamentally altered, with federal and provincial governments compelled to divert massive resources toward rehabilitation and recovery. “The government must immediately reframe priorities, putting flood-hit families and the agricultural sector at the centre of policy.”
Copyright Business Recorder, 2025
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