News
Thursday, September 02, 2010
Floods inflict $43bn damage: PM
* Gilani tells cabinet meeting economic growth will drop to 2.5% in current financial year, down from predicted 4.5%
* Budget deficit is expected to climb to 6-7% of GDP
ISLAMABAD: The damage inflicted to the country’s economy by the floods is estimated at $43 billion, Prime Minister Yousaf Raza Gilani said on Wednesday, adding that due to the devastating floods, the country had suffered Rs 350 to Rs 500 billion worth of damage to infrastructure, livestock and crops.
The country’s economy grew by 4.1 percent during last year and was expected to grow by 4.5 percent during the current fiscal year 2010-11, he said, adding that the damage caused by the floods would bring down the real GDP growth to 2.5 percent for 2010-11.
Chairing a federal cabinet meeting, which reviewed every aspect of the flood situation and relief efforts, Gilani said approximately $200 million would be required for recovery/relief efforts, whereas repair costs of key damaged infrastructure could exceed $1 billion. He said that over 1,645 people had lost their lives while 2,479 had been injured to date.
Gilani said this economic loss would translate into massive job losses and incomes of thousands of families, adding that consequently it could have serious social implications.
The PM informed the cabinet that in order to finalise a national strategy on the rehabilitation of the flood-affected people, a meeting of the Council of Common Interests (CCI) had been convened to take collective decisions in consultation with the provinces on ways and means to rehabilitate the flood-affected people.
He urged the nation and the relief operation authorities to expedite efforts to help their fellow countrymen.
Gilani said one-fifth of the country’s irrigation infrastructure, livestock and crops had been destroyed.
The PM said the inflation target of 9.5 percent for FY 2010-11 would be missed and it had been apprehended that it might hit the range of 15-20 percent. He said inflation would occur in daily use items such as vegetables, spices, lentils, fruits, meat and milk products.
Budget: The budget deficit before the food crisis had been estimated to reach 4.5 percent of the GDP, now it had been estimated to be as much as 6-7 percent of the GDP, he added. “Performance of agriculture will be consequently much lower this year and the year ahead. This loss will have a snowball effect on manufacturing, services and export sectors. Food security of the country is also under threat,” he said. app
Courtesy www.dailytimes.com.pk