Islamabad (TDI): Pakistan has told the International Monetary Fund (IMF) that recent floods caused economic damages worth Rs371 billion, forcing the government to revise its GDP growth forecast for FY26 down to 3.9% from the original 4.2% target set at budget time.
Senior officials from the Ministry of Finance briefed the visiting IMF mission that the country faces external financing needs of $26 billion this fiscal year, with $12 billion expected to be rolled over, The News reported Wednesday.
They cited China’s past assurances to the IMF that all rollover and refinancing commitments would be honoured on time.
Authorities also shared plans to re-enter the global bond market in FY26, potentially launching a Eurobond in the April–June quarter, provided that US interest rates ease and Pakistan’s credit rating improves. In the near term, Islamabad plans to issue Panda bonds in November, targeting $250–300 million.
According to official data, the floods killed 1,006 people, injured 1,063, and damaged 12,569 homes nationwide. Infrastructure losses were extensive, with 2,133 km of roads, 248 bridges, and 866 water systems affected. The disaster also hit 1,098 schools, 128 health facilities, and over 3.26 million acres of farmland.
Read More:Â IMF Mission Arrives in Pakistan to Review Progress Under $8.4 billion Loans
Agriculture bore the brunt of the damage, with estimated losses of Rs155 billion. Cotton output could fall by 1.5–2 million bales from the earlier forecast of 10.2 million, while wheat production is expected to drop by 0.7–1.3 million tons. Sugarcane losses are projected at 2.3–4.3 million tons, and maize by up to 1.3 million tons.
Growth in the agriculture sector, originally projected at 4.5%, may now slip to 4%, while key crops’ growth could drop sharply from 6.7% to 4.5%.
The floods are also expected to shave industrial growth to 4.2% (from 4.3%), and reduce services growth from 4% to 3.7%. Utilities such as electricity, gas, and water supply are forecast to slow from 3.5% to 2.9%.
Read More:Â IMF Releases $1bn Tranche to Pakistan
Breakdowns show that agriculture growth will be cut by 0.5 percentage points, industry by 0.1, and services by 0.3, while housing, infrastructure, and utilities will all see notable slowdowns, the paper added.
On the external side, the State Bank of Pakistan has built reserves by purchasing $7.7 billion from the interbank market since June 2025, including $500 million in that month alone. Meanwhile, Eurobond repayments of $1.5 billion loom, with $500 million already paid at end-September and $1 billion due in April 2026.
