Livelihoods and economic stability hang in balance
Pakistan is facing an unprecedented agricultural and food security crisis following catastrophic floods that have devastated farmland, destroyed infrastructure, and displaced millions. The monsoon deluge has caused an estimated $1.4 billion in economic losses, with agriculture bearing the brunt of the devastation.
According to initial estimates, the total cost of the 2025 floods stands at over Rs500 billion ($1.7 billion). Agriculture alone accounts for Rs302 billion ($1 billion), representing nearly three-fourths of the total. The floods have submerged 1.3 million acres of farmland, primarily in Punjab, the country's agricultural heartland, as well as parts of Sindh and Khyber-Pakhtunkhwa. Key crops such as rice, sugarcane, cotton, and maize have been severely impacted, with early assessments suggesting a 15-20% drop in output in affected areas.
The destruction is not limited to crops. Livestock losses, though smaller in monetary terms at Rs0.5 billion ($2 million), have devastated rural livelihoods. More than 8,000 animals have perished, while over 516,000 livestock have been evacuated from flood-hit zones. For many households, livestock is a vital source of income and nutrition, making these losses particularly severe.
The floods have wiped out what was expected to be a bumper rice and cotton harvest. Farmers in Punjab report near-total destruction of rice paddies and cotton fields. Cotton losses are especially alarming, with up to 80% of Bahawalnagar's crop destroyed, threatening Pakistan's textile industry, which accounts for more than half of the country's exports.
The ripple effects on trade are severe. Cotton shortfalls could force Pakistan to import 737,000 tons, costing $1.06 billion, while export losses in textiles, rice, and sugar are projected at $3 billion. This double blow of higher imports and reduced exports is expected to widen the trade deficit by nearly $6 billion, straining Pakistan's fragile external account.
The floods have also triggered a surge in food prices. Items such as meat, rice, vegetables, and sugar – making up about 20% of the Consumer Price Index (CPI) basket – are already showing sharp increases. Preliminary estimates indicate that food inflation could rise by 4.3% month-on-month in September alone, pushing the FY26 CPI forecast to 7.2%, up from a pre-flood estimate of 5.5%. Analysts warn that delayed wheat sowing, shrinking rice exports, and the need to import cotton will further deepen inflationary pressures.
Beyond economic costs, the human toll is staggering. More than two million people have been affected, with over 2,000 villages inundated. Around a million people have been evacuated, and thousands are now living in temporary shelters. Relief camps, medical sites, and veterinary facilities have been set up across Punjab and Sindh, but authorities warn the crisis is far from over as more rain is forecast.
The floods have worsened an already fragile food security situation. Pakistan, often called the "regional grain basket," now faces acute shortages of staple foods. Analysts estimate that 14.6 million people in flood-hit areas require urgent food and agricultural assistance, with nearly half a million on the brink of severe food insecurity. Shortages of wheat, rice, and vegetables are expected to persist for months, forcing the government to increase imports when reserves are already under pressure.
Experts warn that the 2025 floods are not an isolated event but part of a broader pattern of climate-induced disasters. Pakistan ranks among the 10 most climate-vulnerable countries despite contributing less than 1% to global greenhouse gas emissions. Erratic rainfall, rising temperatures, and glacial melt are increasing the frequency and intensity of floods, posing existential threats to the agrarian economy. Without urgent reforms in water management, crop diversification, and disaster preparedness, Pakistan risks recurring cycles of devastation and food insecurity.
Rebuilding agriculture will require a multi-pronged approach. Immediate relief must reach displaced families and farmers. Farmland restoration through drainage, soil rehabilitation, and provision of inputs is critical. Long-term investments in climate-resilient farming, including drought-tolerant seeds and efficient irrigation, are essential. Strengthening supply chains to ensure timely delivery of food and inputs, along with policy reforms that integrate disaster risk reduction into national planning, will help build resilience.
As the waters recede, Pakistan's challenge is not only to recover from this disaster but also to prepare for the next one. The stakes could not be higher: the livelihoods of millions, the stability of the economy, and the food security of a nation of 250 million people hang in the balance.
The declaration of an agriculture emergency must not be a temporary measure but the foundation of a long-term resilience and recovery plan to ensure sustainable agriculture and food security for decades ahead.
THE WRITER IS AN INTERNATIONAL ECONOMIST