A closer look at the past few years reveals a disturbing pattern that is impossible to ignore: since 2022, not a single year has passed without Pakistan being battered by destructive monsoon floods. What began in 2022 as a catastrophic deluge affecting 33 million people and causing over $15 billion in losses has, in different intensities, become an annual reality. The 2023 floods affected 9 million people and destroyed 849,000 hectares of crops in Balochistan, KPK and parts of Punjab. In 2024, more than a hundred lives were lost again; in 2025, floods killed nearly 900 people and inflicted economic damage worth Rs409 billion. Disaster, it seems, is no longer episodic in Pakistan; it is becoming structural.
Yet as the waters rise year after year, the state’s fiscal priorities remain anchored elsewhere. Pakistan’s latest budget arrives with the usual promises of macroeconomic stability, growth and fiscal discipline. But behind the carefully arranged numbers lies an unsettling truth: the state continues to budget for yesterday’s debts while underbudgeting for tomorrow’s disasters.
There is something deeply paradoxical about a country standing at the frontline of climate catastrophe while treating climate resilience as a peripheral concern. The contradiction has rarely been starker. The Pakistan Economic Survey 2025–26 offers a sobering reminder. The year 2025 was the country’s second warmest in the last 65 years, continuing a disturbing pattern of record-breaking temperatures. In May 2026, Dadu in Sindh recorded a staggering 51.5°C, underscoring the escalating intensity of heat extremes. This is no longer an abstract scientific warning; it is a fiscal reality, an agricultural crisis and, increasingly, a question of national survival.
And yet, the federal budget does not reflect that urgency. Climate change was acknowledged in the 2026–27 budget speech, but only in passing, confined to a few isolated mentions of adaptation, Green Pakistan initiatives and disaster resilience. By any reasonable measure, climate occupied less than five per cent of the budget narrative, dwarfed by exhaustive discussions on taxation, privatisation, debt management and energy reforms. The priorities are unmistakable.
Pakistan loses, on average, over $2 billion annually to climate-related disasters, according to the Asian Development Bank. The Pakistan Economic Survey places the estimated losses and damages from climate shocks in 2025 alone at Rs822 billion. These are not exceptional events anymore; they are recurring economic shocks, systematically eroding growth, deepening poverty and widening inequality.
Heatwaves, for instance, have become one of the gravest threats to Pakistan’s labour force. In a country where millions depend on outdoor and informal work, rising temperatures directly reduce productivity, increase health risks and weaken household incomes. Pakistan already records some of the highest observed temperatures in Asia. Yet labour resilience barely features in the national climate discourse.
Agriculture, contributing around 23–24 per cent to GDP and still forming the backbone of the economy, remains deeply exposed to climate shocks. It is therefore no surprise that its share has been steadily eroding and is expected to decline further in the coming years. Extreme heat, drought, water stress and floods have repeatedly devastated cultivated land, killed livestock and reduced the productivity of wheat, cotton and rice, three pillars of Pakistan’s food security and exports. In a country where agriculture sustains both livelihoods and macroeconomic stability, climate vulnerability is no longer just an environmental concern; it is a direct economic liability.
And still, the state’s response remains institutionally weak. The budget of the Ministry of Climate Change and Environmental Coordination was reduced from Rs3.5 billion to Rs2.7 billion last year, a cut that was rightly called by the ministry itself a “strategic mistake.” Its warning carried weight. According to the 2025 Climate Risk Index by Germanwatch, Pakistan ranks as the world’s most climate-vulnerable country. That ranking should have made climate the centrepiece of fiscal planning. Instead, it remains a footnote.
The irony is even sharper when viewed alongside Pakistan’s newly launched Climate Prosperity Plan. Unveiled by the Finance Division, the plan seeks to transform climate vulnerability into economic opportunity, with projected investments of $1.6 trillion by 2050. The framework is ambitious, and rightly so. It cites World Bank projections warning that under current warming trajectories, Pakistan’s GDP could shrink by 18 to 20 per cent by mid-century. How does a government launch a trillion-dollar climate strategy while simultaneously shrinking the budget of the very ministry meant to steer it? How does it acknowledge climate as an existential challenge but dedicate only fragments of its annual fiscal imagination to it?
For decades, the state has operated in a cycle of reactive economics: borrow, repay, survive, repeat. Climate shocks now threaten to intensify this cycle. Floods destroy infrastructure; heatwaves weaken productivity; agricultural losses reduce exports; reconstruction demands more borrowing; debt servicing expands; development spending contracts. It is a vicious loop where climate neglect and debt dependence feed into one another.
Moreover, Pakistan emits far below its carbon threshold, yet receives only $350 million in climate finance, despite adaptation needs that far exceed that amount. The global climate financing gap is estimated at between $100 billion and $200 billion. Budgets are political documents; they reveal what a state values and what it is willing to postpone. Pakistan’s latest budget 2026–27 reflects a preoccupation with immediate stabilisation while underestimating the rising cost of delay. It is precise in managing debt, but indifferent to disaster. In a warming world, that imbalance may prove to be the costliest miscalculation of all.
Danish Bhutto
The writer is an author, researcher and columnist based in Lahore. He can be reached at danishalee017@gmail.com
