Flood relief to come from budget cuts, says Miftah

Federal Minister for Finance and Revenue Miftah Ismail on Monday said the government has started making budget cuts to provide relief to flood-affected people in the country.

Talking to CNBC International programme Money Sings, the federal minister termed the natural calamity “a catastrophe of unimaginable magnitude”.

Thus far, $10bn losses caused by floods: Miftah

Pakistan has been ravaged by torrential rains resulting in flash floods from north to south that have resulted in over 1,300 deaths while causing large-scale infrastructure damage. The country’s agricultural sector, especially in Sindh and Balochistan, has been hit the hardest with the finance ministry also recently warning that production of major crops would be affected due to the floods.

The federal minister said the rebuilding effort would require at least Rs2,000 billion, and most of that money will have to come from the government budget.

“I am already cutting the budget and diverting funds to provide relief and rehabilitation to people,” said Miftah.

Record monsoon rains and melting glaciers in Pakistan’s northern mountains have brought floods that have affected 33 million people and killed at least 1,314, including 458 children, Pakistan’s National Disaster Management Agency said earlier.

The floods have followed record-breaking summer temperatures and the government and the United Nations have both blamed climate change for the extreme weather and the devastation it has brought

The federal minister said that a third of Pakistan is actually under water.

“If you look at Google Maps, our second most populous province (Sindh) actually looks like a lake, that’s how much water is still standing on the ground.

“The entire crop of cotton, date palms in Sindh has been wiped off. Close to 20% of our sugarcane crop in Sindh has been devastated, while more than a million livestock heads have perished. Moreover, at least a million homes have been destroyed,” he said.

The minister said that over 40 million people have been affected, while millions have lost everything including their homes, farms and livestock.

Miftah warns of food insecurity as floods dent wheat, rice crops

Talking about the relief efforts, Miftah said that the government has managed to restore electricity in over 99% of the areas, while telecommunication services have also been restored. “The government has started giving Rs25,000 to the heads of each family, and we are talking about 4.6 million recipients in all the districts,” he said.

He said that the government has also abolished duties on food items so that food prices come down. “However, the scale is actually beyond our capability, but we are trying to do the best we can."

Miftah said that the total damage is more than $10 billion while adding that he was told that over three million mud houses in Sindh have been destroyed.

“For now what we have got is the UN flash appeal of $160 million, whereas the World Bank has repurposed loans of $350 million from other areas into immediate relief... countries are doing it, but it is clearly not enough as Pakistan despite its resources has to do much of the heavy lifting,” he said.