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Economic loss from floods in Pakistan reaches $18b

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  • Economic losses have gone up further, says Centre.
  • Increase is mainly because agricultural crops have been destroyed.
  • New estimate states 8.25m acres of crops destroyed.

The rapid assessment cost on projected economic losses following floods as calculated by the Centre and endorsed by the provinces has gone up further to the tune of $17-$18 billion.

The economic losses have further increased mainly because agricultural crops have been destroyed across 8.25 million acres as compared to an initial assessment of 4.2 million acres. Cotton, rice, and minor crops have been damaged severely and if de-watering is not done properly, it can cause serious problems for wheat sowing.

Cotton crop has evaporated in most parts of the country and now wheat sowing is under threat.

The Ministry of National Food Security has been assigned to come up with a summary to increase the minimum support price of wheat for the coming crop. The authorities have held meetings with international donors and assured them that Pakistan would place an effective monitoring and evaluation system to utilise each and every penny to mitigate the flood losses in a transparent manner.

“The UN secretary-general is due Friday (today) for a three-day visit and Islamabad is going to share the rapid assessment cost with him. The international donors under the supervision of the World Bank are making their separate study on Damage and Need Assessment and then these figures will be reconciled,” official sources told The News Thursday.

The Ministry of Planning is undertaking an exercise to slash down the Public Sector Development Program (PSDP) by Rs250 to Rs300 billion to bring it down from Rs800 billion to Rs500 to Rs550 billion for the current fiscal year. These resources will be diverted toward the flood-affected areas.

When contacted, Minister of State for Finance Aisha Ghaus Pasha and inquired about the latest rapid assessment cost, she refused to share the exact information and said that the cost had escalated and efforts were underway to finalise it by giving a cut-off date.

Under the rapid assessment exercise, the government had initially envisaged the cost of economic losses to the tune of $10 to $12.5 billion but the revised estimates suggested that the accumulated cost of economic losses had escalated up to $17 to $18 billion.

The per capita income is projected to slow down in the wake of the reduced GDP growth. The government had envisaged a GDP growth rate of 5 percent for the current fiscal year. The IMF had recently projected that the GDP growth would be standing at 3.5 percent for the current fiscal year. However, the floods damaged the agriculture sector and the industrial sector also gave an indication of slowing down, so the GDP growth might be below two per cent.

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The NORINCO Group is invited by CM Sindh to explore opportunities.

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Chinese companies have been invited by Sindh Chief Minister Syed Murad Ali Shah to visit Karachi and other regions of Sindh Province in order to observe the quickly growing businesses and investigate prospects in fields like clean energy, infrastructure development, and public transit projects.

Speaking in Beijing to a delegation headed by the chairman of NORINCO International Co., Ltd., he stated that all facilities required would be provided by the governments of Sindh Province and Pakistan.

With assistance from NORINCO International, the Sindh Chief Minister stated that the Provincial Government will firmly urge North Vehicle and BeiBen to think about setting up a Vehicle Assembly Plant in the Dhabeji Special Economic Zone.

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A deal with Pakistan to fight financial crimes has been approved by the Saudi cabinet.

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In order to strengthen collaboration in the fight against money laundering, terrorist financing, and associated crimes, the Saudi Press Agency announced this week that the Saudi cabinet, led by Crown Prince Mohammed bin Salman, had approved a memorandum of understanding (MoU) with Pakistan’s Financial Monitoring Unit (FMU).

Due to its severe money laundering and terrorism funding issues in recent years, Pakistan was added to the Financial Action Task Force’s (FATF) grey list in June 2018.

The nation was taken off the gray list in October 2022 after enacting extensive measures to fortify its financial system.

The FMU is Pakistan’s financial intelligence unit, created under the Anti-Money Laundering Act of 2010 and tasked with collaborating with foreign partners and evaluating reports of suspicious transactions.

According to the SPA, “the cabinet approved a memorandum of understanding regarding cooperation in exchanging investigations related to money laundering, terrorist financing, and related crimes between the Financial Monitoring Unit in the Islamic Republic of Pakistan and the General Department of Financial Investigation at the Presidency of State Security in the Kingdom of Saudi Arabia.”

The MoU is an indication of Saudi Arabia and Pakistan’s growing strategic partnership. A significant Pakistani diaspora resides in the Kingdom, and numerous Pakistani businesses have established a presence there.

Saudi Arabia has been a key supporter of Pakistan’s economy, bolstering its reserves with substantial deposits in the State Bank of Pakistan and offering deferred oil payment facilities.

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SFD and Pakistan Sign Two Deals Totaling $1.61BLN

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Two agreements totaling $1.61 billion have been inked by Pakistan and the Saudi Fund for Development to improve their bilateral economic cooperation.

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