The devastating floods in Punjab are beginning to ripple through Pakistan’s fragile economy, with major disruptions in supply chains, fears of rising food prices, and concerns regarding inflation making a comeback just as it had started to ease.
In villages across Punjab, families are struggling with damaged homes and ruined fields, while in cities, businesses are reporting delays in shipments, especially on routes outside the motorway network. The situation is raising alarms among traders, farmers and policymakers alike.
Transporters Struggle Amid Flooded Routes
Goods transporters say consignments moving from Karachi to Punjab and back are facing two- to three-day delays. According to Nisar Hussain Jafri, President of the All Pakistan Goods Transport Alliance, the absence of proper diversion signs in flood-hit areas has left truck drivers stranded at dead ends.
“City governments in Punjab must immediately install diversion signs for container trucks. Every unnecessary stop costs us diesel, time, and money,” Jafri stressed.
While motorways and major highways remain open, alternate routes through interior Punjab — often used for faster or cheaper transport — are badly affected. This is slowing down the delivery of both imported goods and local produce, impacting everything from food items to industrial supplies.
Fertiliser Shipments Suspended in River Corridors
The fertiliser industry is also under stress. Retired Brig Shershah Malik, Executive Director of the Fertiliser Manufacturers of Pakistan Advisory Council (FMPAC), said that shipments through flood-hit areas along the Sutlej, Ravi, and Chenab rivers have been completely suspended.
“If floods persist, fertiliser supply and consumption will be disrupted, especially once waters move towards Multan and Sindh by early September,” he warned.
Although demand in submerged areas has temporarily stopped — since farming activity itself is at a standstill — a prolonged suspension could create shortages during the next sowing season, hitting agricultural output and food security.
Karachi Vegetable Market Feels the Pinch
Flooding has also begun to affect everyday food supplies. Haji Shahjehan, President of the Falahi Anjuman Wholesale Vegetable Market (New Subzi Mandi Karachi), confirmed that onion supplies from Balochistan and potato supplies from cold storages have declined. Traders warn that if the situation worsens, Karachi’s vegetable prices may surge, adding more burden on already struggling households.
Oil and Medicine Supplies Stable — For Now
In contrast, fuel and pharmaceutical supplies remain largely unaffected. Syed Nazir Abbas Zaidi, Secretary General of the Oil Companies Advisory Council (OCAC), said oil transport was moving normally but admitted uncertainty about the coming days. Similarly, Pakistan Pharmaceutical Manufacturers Association Chairman Tauqeer-ul-Haq reported that medical supplies were continuing without disruption so far.
Experts Warn of Inflationary Pressures
Economists are already warning that the Punjab floods pose a significant risk to agricultural output and could reverse recent progress in controlling inflation. Mohammad Shahroz of Insight Securities noted that while headline inflation dropped to 4.1% in August 2025 from 9.6% last year, supply shocks from food disruptions may push prices up again.
On a month-to-month basis, inflation is expected to rise slightly (0.4%) in August due to higher food costs, though this is being offset somewhat by lower electricity tariffs and LPG prices.
“Pakistan is in a fragile stabilisation phase. Any prolonged disruption in food and fertiliser supply chains could reignite supply-side inflation and derail recovery,” Shahroz cautioned.
A Human and Economic Crisis
Beyond numbers, the crisis is deeply human. Families in Chiniot, Multan, and southern Punjab villages have been displaced, their homes and fields all washed away by the overflowing Chenab.
Farmers who lost standing crops now encounter extreme uncertainty regarding the next planting season, while truck drivers spend nights stranded there on flooded roads.
As Pakistan braces for floods entering Sindh in the upcoming week, the urgent challenge is considered to be twofold: saving lives and livelihoods in the flood-hit areas, while protecting the national economy from another wave of inflation.