Pakistan ‘better off’ than last floods, but fiscally bound
Pakistan has entered this year’s flood season with more substantial economic buffers than it had before the 2022-23 floods, but the country’s improved macroeconomic situation comes with new constraints, according to a `targeted analysis’ carried out by the Famine Early Warning Systems (FEWS) Network. The analysis expects that the 2025 floods will primarily drive short-term, localised, food insecurity among flood-affected households. Produced at the request of the US government as a part of FEWS NET’s global coverage, the report notes that this time, the flood response will be constrained by limited fiscal intervention capacity, in contrast to the emergency subsidies in 2022-23. The 37-month IMF Extended Fund Facility explicitly prohibits the use of untargeted subsidies and market interventions that were used during the previous floods.