Pakistan Economy 1

Pakistan is a rapidly developing country which has faced a number of challenges on both political and economic fronts. Despite being a very poor country in 1947, Pakistan's economic growth rate was better than the global average during the subsequent four decades, but imprudent policies led to a slowdown in the late 1990s. Recently, wide-ranging economic reforms have resulted in a stronger economic outlook and accelerated growth especially in the manufacturing and financial services sectors. There has been great improvement in the foreign exchange position and rapid growth in hard currency reserves in recent years. The 2005 estimate of foreign debt was close to US$40 billion. However, this has decreased in recent years with assistance from the International Monetary Fund (IMF) and significant debt-relief from the United States. Pakistan's gross domestic product, as measured by purchasing power parity (PPP), is estimated to be US$475.4 billion while its per capita income (PCI) stands at $2,976. Despite clear progress, reports by the Asian Development Bank, the World Bank and the UN Development Program place the poverty rate in Pakistan between 23%- 28%.

The CIA factbook places the poverty rate at 24% in 2006,[53] and notes that levels have fallen by ten percent since 2001. Pakistan's GDP growth rates have seen a steady increase over the last 5 years. However, inflationary pressures and a low savings rate, among other economic factors, could make it difficult to sustain a high growth rate, according to some analysts.
The growth of non-agricultural sectors has changed the structure of the economy, and agriculture now only accounts for roughly 20% of the GDP. The service sector accounts for 53% of the country's GDP with wholesale and retail trade forming 30% of this sector. In recent times, the Karachi Stock Exchange has soared, along with most of the world's emerging markets. Large amounts of foreign investments have been made into several industries. The top...