Khushi Mohammad sat by the roadside, gazing fixedly at the rising Chenab waters that had drowned his village near Qadirabad Barrage a night earlier.

“We’re ruined; everything we had until yesterday is gone now,” he blurted out before resuming his watch.

The deluge had washed away his mud-and-brick house, crops, farm tools and anything he had when the fast-moving floodwaters passing through Qadirabad over a week ago breached embankments and swamped scores of villages in the area.

The ongoing massive flooding has caused irreparable losses to the tens of thousands of small-holders like Khushi Mohammad in the province. By Friday night, the deluge in Chenab and Jhelum, following the torrential rains, had displaced, marooned and affected around 2.1m people, swept away or damaged over 32,000 houses in several districts from Sialkot to Muzaffargarh in central and southern Punjab, say senior provincial disaster management authority officials.

Government officials, economists and analysts are trying to assess the cost of flooding to the economy. Some argue that the magnitude of the destruction will exceed the damage brought upon by the 2010 floods. At that time, the Punjab government had estimated flood-related damages to be around Rs300bn.

Analysts agree that the scale of destruction caused by the deluge is big enough to affect the government’s growth, inflation and development spending targets for the present year.

BMA Capital, a brokerage house, for example, pointed out in a report that the “ongoing floods would likely have severe repercussions for macroeconomic stability and growth prospects of the country...the devastating floods in Punjab, likely to hit Sindh as well, would drag the overall GDP growth target”.

The 2010 floods had pulled down GDP growth to just 2.6pc against the target of 4.5pc for 2010-11.

“Rice, sugarcane and cotton crops on about 1.2m acres have been destroyed in 2,700 affected villages,” a PDMA official told Dawn. “But these are only initial estimates and the actual losses could be much bigger. The exact cost of flooding to the people and the provincial economy will be known only after the completion of the survey of the affected districts.”

Few are prepared to hazard a guess about the economic losses caused by the recent floods. “It will be too early to say anything about the scale of the damage done to the economy. However, the human cost of floods is going to be significantly high for the survivors in terms of loss of livelihoods, income, schooling, food, displacement, etc. There is going to be a lot of pressure on the government to do something for them,” noted Asad Sayeed, a prominent economist.

A provincial official involved in rescue and relief efforts in the flood-affected districts said the losses caused by floods and torrential monsoon was much higher than in 2010.

“At that time, the Indus had gotten out of control and rampaged Khyber Pakhtunkhwa and Sindh more than Punjab. This time around, the destruction has been caused by Chenab and Jhelum in Punjab. The surge in flow in seasonal drains and torrential rains has worsened the situation.”

He said the flooding had also significantly damaged irrigation and flood-control infrastructure, as well as connecting roads and highways in the province, besides destroying private infrastructure, agriculture, and, at some places, small industry. “Both the human and economic cost of the floods in Punjab is going to be much higher than it was in 2010.”

“Massive flooding like this can have a devastating impact on the economy, and the cost of loss of livelihood and income of people, damage to public and private property and socio-economic infrastructure, destruction of crops, and loss of livestock etc during flooding can be very high,” said Shahid Zia, a financial analyst.

“Floods will affect growth this year but not as much as it did in 2010. Nevertheless, I feel the Punjab government will be forced to divert a significant amount of development funds to its rescue and relief efforts, as well as to the rehabilitation of the affected people and rebuilding of the damaged economic and social infrastructure in the province,” said Shahid.

Published in Dawn, Economic & Business, Sep 15th, 2014