Agricultural damage due to floods in the Indus basin’s fertile land has been the most damaging natural disaster in Pakistan so far. Earthen dikes are protecting the vast areas of the floodplain from regular flooding. However, the floodplain is attractive to farmers due to its fertility and experiences regular crop production within and out of the dike area. This paper evaluates the flood risk in a floodplain of the Chenab river in Pakistan and recommends land-use changes to reduce the flood risk for crops and associated settlements within the study area. The objective of the land-use change is not just to reduce flood losses but also to increase the overall benefits of the floodplain in terms of its Economic Rent (ER). This preliminary study analyses the economic impacts of the risk-based land-use improvements on existing floodplain land uses. Expected Annual Damage (EAD) maps were developed using hydrodynamic models and GIS data. The developed model identified the areas where maize can be economically more productive compared to rice under flood conditions. Promising results were obtained for the settlement relocations. It was also observed that the infra-structure, running parallel to the river, plays a significant role in curtailing the extent of floods. The results show that a combination of structural and non-structural measures proves more effective. The study also recommends the inclusion of social and environmental damages as well as other types of non-structural measures to develop the most effective flood management strategy.