Floods are not just a humanitarian tragedy but a profound economic threat: Mian Zahid

Mian Zahid Hussain, President Pakistan Businessmen and Intellectuals Forum & All Karachi Industrial Alliance, Chairman National Business Group Pakistan, Chairman Policy Advisory Board FPCCI, and Former Provincial Minister, said that Pakistan has recently shown commendable progress in its economic recovery, and we must acknowledge the hard-won gains in key areas. Mian Zahid Hussain said the government’s fiscal consolidation efforts have narrowed the fiscal deficit.
We have also seen significant strides in taming inflation, which has fallen to 3.00 percent as of August 2025, the lowest half-yearly inflation since FY19. Despite these positive indicators, Hussain cautioned that the catastrophic 2025 monsoon floods threaten to reverse this progress.
The floods are not just a humanitarian tragedy but a profound economic threat.
The widespread destruction of key food crops like rice, maize, and vegetables represents a severe supply-side shock. He warned that this would likely lead to a sharp rise in domestic food prices, directly impacting household budgets and undermining the Government’s efforts to control inflation.
Hussain further noted the apparent paradox of the Karachi Stock Exchange’s (PSX) record rally. While the market is betting on a massive post-disaster reconstruction effort, fueled by demand for cement and fertilizer, this optimism masks the immediate and significant risks.
He stressed the urgent need for a strategic, two-pronged approach, and we must prioritize efficient flood relief and reconstruction while maintaining fiscal discipline. Simultaneously, the government must fast-track support for the agricultural sector to mitigate crop losses and prevent a food crisis.
Our hard-won economic gains may be fragile unless a coordinated and swift response is made to protect them by reducing markup rates to 7% and lowering electricity prices to 9 cents, necessary for boosting exports to the next level.