(PDF) Pakistan's water economy : running dry - background 2026

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The water crisis is putting the largest sector of the countrys economy at risk. Besides water deficiency and drought, there are other issues like water-logging and salinity affecting Pakistans crops, which are responsible for 60 percent of the agriculture sectors contribution to GDP.
Inadequate water reservoirs, water wastage in agriculture and households, negligible wastewater recycling, and contamination of drinking water are causing health risks that have turned serious national security challenges for Pakistan.
Pakistans water crisis is explained mainly by rapid population growth followed by climate change (floods and droughts), poor agricultural sector water management, inefficient infrastructure and water pollution.

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Economic growth is a thirsty business. Water is a vital factor of production, so diminishing water supplies translates into slower growth. Some regions could see their growth rates decline by as much as 6 percent of GDP by 2050 as a result of water-related losses in agriculture, health, income and prosperity.
4.2. 2 Water resource management system. The IRS is a lifeline for Pakistans survival as majority of the agricultural production is dependent on the river water. The Indus Basin contributes more than 25% of Pakistans GDP, as it provides a critical water supply to almost 90% of the food production crops in Pakistan.
Along with the crisis posed by rivers and streams running dry, Pakistans dangerously depleted groundwater levels have left most parts of the country parched. If present trends persist, the entire country may face water scarcity by 2025, states the PIDE report. Pakistanis are already feeling the effects.
Pakistan majorly exports crops, an essential contributing factor in its economy. Insecurity of water will affect it drastically and can threaten the economic security of the country, particularly when national financial revenue is already compromised due to lockdown [49].
Water is a crucial resource for the livelihood of people and sustained development of any economy. For Pakistan, it takes on more significance, as the economy is agrarian in nature and depends on a single source, the Indus basin, to meet most of its water needs.

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