Climate Change: Pakistan Requires Massive Assistance to Recover From Catastrophic Floods

[Riaz Haq]

Pakistan is dealing with the aftermath of the worst floods in the country's history.  Over a thousand Pakistanis are dead. About 33 million people in two southern provinces are homeless. Sindh is inundated with 784% of normal rainfall so far this year. Balochistan has seen 522% of average rainfall. Both provinces suffered their worst ever heatwave prior to this unprecedented deluge. Nearly a million livestock have been lost, over two million acres of farmland is underwater and 90% of the crops in Sindh and Balochistan have been damaged. This is a massive humanitarian crisis. Pakistan can not deal with it alone.

Pakistan Flood 2022 Map. Source: DW

Satellite Image of Qambar, Sindh Before/After Floods 2022. Source: ...

Satellite Image of Shikarpur, Sindh Before/After Floods 2022. Source: NASA

Balochistan and Sindh Worst Affected by Monsoon22. Source: The Econ...

Pakistan's population is about 2.6% of the world population. The nation contributes less than 1% of the global carbon emissions. It lacks the resources needed to deal with the consequences of this man-made disaster. The Industrial Revolution in Europe and the United States was fueled mainly by fossil fuels such as coal and oil believed to be responsible for climate change.  The following map from Professor Jason Hickel shows that the countries in the global north are the biggest polluters while those in the global south are the most vulnerable to the effects of climate change. 

Climate Injustice: Low Emitters Global South vs Big Polluters in In...

Average Annual Cost of Floods in Vulnerable Countries. Source: Bloo...

Comparison of 2022 and 2010 Floods in Pakistan. Source: WWF

It will take hundreds of millions of dollars to provide immediate relief to 33 million people, followed by tens of billions of dollars in assistance to rebuild the lives and livelihoods and the infrastructure destroyed by this catastrophe. Pakistan's gross capital formation is only 15% of its GDP. Among the world’s top 20 economies by population, only Egypt has a lower rate of gross capital formation than Pakistan, according to Bloomberg. It is time for the rich industrialized world to help developing nations such as Pakistan to deal with the massive impact of climate change. 

Low Gross Capital Formation in Pakistan. Source: Bloomberg

All Pakistanis and non-Pakistanis need to pitch in with donations to help finance immediate disaster relief activities. Beyond that, Pakistan will have to be helped by international experts to build disaster preparedness capacity. The new housing and infrastructure will have to be funded and built to ensure its resilience in future climate disasters which are likely to occur more often with greater intensity. There is an urgent  need to prepare western and multilateral financial institutions to deal with such climate catastrophes in developing nations. Mechanisms also need to be put in place to provide and manage funding of these projects in a transparent manner. 

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[Riaz Haq]

Climate Change and Potential Demise of the Indian Deserts
P. V. Rajesh, B. N. Goswami
First published: 31 July 2023

https://agupubs.onlinelibrary.wiley.com/doi/full/10.1029/2022EF003459

Abstract
In contrast to the “wet gets wetter and dry gets drier” paradigm, here, using observations and climate model simulations, we show that the mean rainfall over the semi-arid northwest parts of India and Pakistan has increased by 10%–50% during 1901–2015 and is expected to increase by 50%–200% under moderate greenhouse gas (GHG) scenarios. The GHG forcing primarily drives the westward expansion of the Indian summer monsoon rainfall (ISMR) and is facilitated by a westward expansion of the Indian Ocean (IO) warm pool. Mechanistically, the westward expansion of ISMR is a consequence of the episodic genesis over IO and the northward propagation of an expanded Inter-Tropical Convergence Zone on a sub-seasonal time scale. While an adaptation strategy to increased hydrological disasters is a must, harnessing the augmented rainfall would lead to a substantial boost in food productivity, bringing transformative changes in the socio-economic condition of people in the region.

Key Points
Global warming could potentially cause a westward expansion of the Indian monsoon

Rainfall in northwest India and Pakistan has increased and will continue to rise due to greenhouse gases

Increased monsoon rainfall can improve food productivity and socio-economic conditions in the region

Plain Language Summary
An apparent eastward shift of the Indian monsoon has led to the arid conditions in the west and north-west regions of India where monsoon was once active, and the Indus Valley civilizations thrived (5,300–3,300-year BP). A reversal of the process and a westward expansion of the present-day Indian monsoon would transform the west and north-west India to a humid “monsoonal” climate and provide food security to the expanding population of the country. The present study shows that the Indian monsoon is indeed expanding to the west with 10% decrease of mean rainfall in the northeast and 25% increase in the west and north-west during the historical period with a potential of 50%–100% increase in the north-west under SSP2–4.5. Harvesting the increased rainfall has the potential for significant increase in food productivity bringing in transformative changes in the socio-economic condition of people of the region.

[Riaz Haq]

ADB to provide $2bn in annual assistance to Pakistan for climate resilience over next 3 years - Business - DAWN.COM

https://www.dawn.com/news/1859605


The Asian Development Bank (ADB) has announced that it will provide $2 billion in annual assistance to Pakistan over the next three years to support infrastructure development and climate-resilient initiatives.

In 2022, massive floods triggered by climate change devastated several parts of Pakistan, killing 1,700 people, washing away swathes of agricultural land, affecting 33 million people, and incurring losses worth $30 billion, according to government estimates.

A report by the Policy and Strategy Committee (PSC) and the Oversight Board on Post-Flood Reconstruction Activities showed last week that the country had only received $10.9bn from international development partners out of the total estimated loss for post-flood reconstruction work, leaving a $19.1bn shortfall that has halted the rehabilitation of flood-affected communities in three provinces.

According to a statement from the President’s House, the announcement was made during a meeting between President Asif Ali Zardari and ADB’s head Masatsugu Asakawa in Islamabad on Tuesday.

[Riaz Haq]

Pakistan’s floods recovery ‘test case’ leaves millions still in tents


https://www.ft.com/content/5dbcb6d5-d6bf-4549-9aa5-fd964efbc206



Pakistan is a disappointing test case for global financial co-operation aimed at helping countries after extreme climate events, local and international officials said, as 12mn victims languish in tents and makeshift huts after devastating floods two years ago. The amount initially pledged to support the recovery was more than $10bn, coming from wealthy countries, the World Bank and multilateral development banks, out of an estimated $16.3bn needed in total. But government and international development officials in Pakistan said that the cash-strapped country of 240mn has since been short-changed by the international community.



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Typically, most of the money pledged in assistance to needy nations comes in the form of more high-interest debt rather than grants, with developing nations pushing for reform of the World Bank and IMF systems at meetings this week



Officials and aid workers in Sindh are racing before another disaster strikes to use the money that has been freed up to reconstruct more than 2mn homes in what they say is one of the world’s largest housing rehabilitation projects. Sindh People’s Housing for Flood Affectees (SPHF), a non-profit company launched by the provincial government armed with some $2bn, mostly from the World Bank and other development lenders, has already built 200,000 brick-and-cement homes with another 700,000 still under construction, sturdier replacements for the traditional mud-and-thatch huts. SPHF and the Sindh government faced a slow start, as they wrangled with cautious development banks, risk-shy local lenders and feudal landlords to secure project funding, open bank accounts for flood survivors, and provide formal land titles or tenancy agreements to allow victims, many of whom work as peasants, the right to build a home. Khalid Sheikh Mehmood, the chief executive of SPHF, expects that his organisation will be able to complete all of its reconstruction by 2026 and that the project will pay for itself threefold. “You’re giving someone a new house that doesn’t fall in heavy rains, a house they can protect their livestock, their asset, in, and a sense of empowerment,” he said. “That $2bn will easily turn into $7bn of value.”

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A key figure in climate finance, Avinash Persaud, special adviser on climate change to the president of the Inter-American Development Bank, said Pakistan’s experience was not unusual for countries in its position. “As often happens that money doesn’t materialise or it is highly conditional. The conditions aren’t able to be reached; they are not practical. “It is a real problem when so much of loss and damage after a flood is not money you can recoup. You are rebuilding homes that have been washed away, schools and clinics that have been washed away. If nations have to do that every time they will sink on the oceans of debt before the sea levels rise up themselves. That is why we do need it to be grant-based. “The reality is what happened in Pakistan is not unusual. When people said this would be a test case [for loss and damage], what they were sort of saying was this can’t be a repeat of what normally happens. We need to show this is different. But unfortunately it wasn’t different.” Former Pakistan climate minister Rehman has a stark message for other vulnerable nations, particularly those near the equator, that are not climate resilient. “In a word, I’m disappointed. If there is a lesson in all this, it’s fend for yourselves.”

[Riaz Haq]

Pakistan requests $1 bln in IMF climate cash and sees reserves rising

https://www.reuters.com/world/asia-pacific/pakistan-formally-reques...


Pakistan seeks $1 bln from IMF climate facility, finance minister says
Pakistan in talks on AIIB support for planned Panda bond
Forex reserves expected to reach $13 bln by March
WASHINGTON, Oct 24 (Reuters) - Pakistan is targeting around $1 billion in a formal request for funding from the IMF facility that helps low and middle income countries mitigate climate risk, its finance minister told Reuters.
"We have formally requested to be considered for this facility," Finance Minister Muhammad Aurangzeb said in an interview on the sidelines of the IMF/World Bank autumn meetings in Washington.
The International Monetary Fund had already agreed a $7 billion bailout for Pakistan, but has further funding available via its Resilience and Sustainability Trust (RST).
The RST, created in 2022, provides long-term concessional cash for climate-related spending, such as adaptation and transitioning to cleaner energy.
"We think we are a very good candidate to be considered for a facility like this," Aurangzeb said, adding that they aim to conclude the request in the coming months.
The South Asian nation is one of the most vulnerable countries to climate change according to the Global Climate Risk Index.
Floods in 2022, which scientists said were aggravated by global warming, affected at least 33 million people and killed more than 1,700. The country's economic struggles and high debt burden impinged its ability to respond to the disaster.
Pakistan is also in talks with the Asian Infrastructure Investment Bank for a credit enhancement for a planned Panda bond, Aurangzeb said. It is targeting an initial issuance of $200-250 million by the end of June.

A Panda bond would be Pakistan's first foray into China's capital markets. Aurangzeb said they were talking to "a few other institutions" in addition to the AIIB for a credit enhancement.
Credit enhancements provide some level of guarantee for bonds, which can boost their rating, attract more investors and thus cut the government's borrowing costs.
Issuing in the world's "second largest and the second deepest" capital market was, Aurangzeb said, the key aim, rather than a particular issuance size.

"From our perspective it is diversification of the funding base," Aurangzeb. "Even if the inaugural issue is not significant in size, for us it is important that we print that and of course then we can keep it on tap."
Aurangzeb said Pakistan has engaged with Middle Eastern banks regarding commercial loans, and one had submitted "a relatively significant proposal."
Pakistan's foreign exchange reserves should reach $13 billion by the end of March, Aurangzeb said, which would help with commercial lending, and potentially its credit rating.

The foreign exchange reserves reached $11.04 billion in the week ending Oct. 18, the central bank said.
Moody's upgraded Pakistan's ratings to 'Caa2' in August, citing improving macroeconomic conditions, and Fitch boosted its rating to CCC+ in July following the IMF staff level agreement. But both ratings are sub investment grade.