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The economy of Pakistan is the 47th largest in the world in nominal terms and 27th largest in the world in terms of purchasing power parity (PPP). Pakistan has a semiindustrialized economy, which mainly encompasses textiles, chemicals, food processing, agriculture and other industries. Growth poles of Pakistan's economy are situated along the Indus River; diversified economies of Karachi and Punjab's urban centers coexist with lesser developed areas in other parts of the country. The economy has suffered in the past from decades of internal political disputes, a fast growing population, mixed levels of foreign investment, and a costly, ongoing confrontation with neighboring India. Foreign exchange reserves are bolstered by steady worker remittances, but a growing current account deficit – driven by a widening trade gap as import growth outstrips export expansion – could draw down reserves and dampen GDP growth in the medium term
First five decades
When it gained independence in 1947 from UK, Pakistan's average economic growth rate since independence has been higher than the average growth rate of the world economy during the period. Average annual real GDP growth rates were 6.8% in the 1960s, 4.8% in the 1970s, and 6.5% in the 1980s. Average annual growth fell to 4.6% in the 1990s with significantly lower growth in the second half of that decade. See also During the 1960s, Pakistan was seen as a model of economic development around the world, and there was much praise for its economic progression. Karachi was seen as an economic role model around the world, and there was much praise for the way its economy was progressing. Many countries sought to emulate Pakistan's economic planning strategy and one of them, South Korea, copied the city's second "Five-Year Plan" and World Financial Center in Seoul is designed and modeled after Karachi. Later, economic mismanagement in general, and fiscally imprudent economic policies in particular, caused a large increase in the country's public debt and led to slower growth in the 1970s and 1990s.The economy recovered during the 1980s via a policy of deregulation, as well as an increased inflow of foreign aid and remittances from expatriate workers.
This is a chart of trend of gross domestic product of Pakistan at market prices estimated by the International Monetary Fund with figures in millions of Pakistani Rupees. See also
Economic resilience First five decades
When it gained independence in 1947 from UK, Pakistan's average economic growth rate since independence has been higher than the average growth rate of the world economy during the period. Average annual real GDP growth rates were 6.8% in the 1960s, 4.8% in the 1970s, and
6.5% in the 1980s. Average annual growth fell to 4.6% in the 1990s with significantly lower growth in the second half of that decade. See also During the 1960s, Pakistan was seen as a model of economic development around the world, and there was much praise for its economic progression. Karachi was seen as an economic role model around the world, and there was much praise for the way its economy was progressing. Many countries sought to emulate Pakistan's economic planning strategy and one of them, South Korea, copied the city's second "Five-Year Plan" and World Financial Center in Seoul is designed and modeled after Karachi. Later, economic mismanagement in general, and fiscally imprudent economic policies in particular, caused a large increase in the country's public debt and led to slower growth in the 1970s and 1990s.The economy recovered during the 1980s via a policy of deregulation, as well as an increased inflow of foreign aid and remittances from expatriate workers.
This is a chart of trend of gross domestic product of Pakistan at market prices estimated by the International Monetary Fund with figures in millions of Pakistani Rupees. See also
Historically, Pakistan's overall economic output (GDP) has grown every year since a 1951 recession. Despite this record of sustained growth, Pakistan's economy had, until a few years ago, been characterized as unstable and highly vulnerable to external and internal shocks. However, the economy proved to be unexpectedly resilient in the face of multiple adverse events concentrated into a four-year (1998–2002) period —
• • • • •
the Asian financial crisis; economic sanctions – according to Colin Powell, Pakistan was "sanctioned to the eyeballs"; The global recession of 2001–2002; a severe drought – the worst in Pakistan's history, lasting about four years; heightened perceptions of risk as a result of military tensions with India – with as many as 1 million troops on the border, and predictions of impending (potentially nuclear) war; the post-9/11 military action in neighboring Afghanistan, with a massive influx of refugees from that country;
Despite these adverse events, Pakistan's economy kept growing, and economic growth accelerated towards the end of this period. This resilience has led to a change in perceptions of the economy, with leading international institutions such as the IMF, World Bank, and the ADB praising Pakistan's performance in the face of adversity.
Macroeconomic reform and prospects
These industries play to Pakistan's relative strengths in low labor costs. and a great expansion in the quantity of credit. As a large country. Motorways & Strategic Roads of Pakistan. the Pakistani government has made substantial economic reforms since 2000. and the country also expects to profit from freer trade in agriculture. Pakistan is also moving away from the doctrine of import substitution which some developing countries (such as Iran) dogmatically pursued in the twentieth century. roads. Islamabad has doubled development spending from about 2% of GDP in the 1990s to 4% in 2003. Pakistan is aggressively cutting tariffs and assisting exports by improving ports. a necessary step towards reversing the broad underdevelopment of its social sector. Liberalization in the international textile trade has already yielded benefits for Pakistan's exports. electricity supplies and irrigation projects. Growing stability in the nation's monetary policies has contributed to a reduction in money-market interest rates. the World Bank reported that . Pakistan's domestic natural gas production. The Pakistani government is now pursuing an export-driven model of economic growth successfully implemented by South East Asia and now highly successful in China. and to replace China as the largest textile manufacturer as the latter China moves up the value-added chain. In 2005.National Highways. Government revenues have greatly improved in recent years. changing consumption and investment patterns in the nation. According to many sources. Pakistan hopes to take advantage of significant economies of scale. and its significant use of CNG in automobiles. has cushioned the effect of the oil-price shock of 2004–2005. and more efficient tax collection as a result of selfassessment schemes and corruption controls in the Central Board of Revenue – and the privatization of public utilities and telecommunications. tax reforms – with a broadening of the tax base. as a result of economic growth. and medium-term prospects for job creation and poverty reduction are the best in nearly a decade.
Pakistan comes highest in South Asia but also ranks higher than China and Russia which is at 133. Pakistan's economic outlook has taken stagnation. Pakistan raised back its Foreign Reserves to a handsome $16. and replacing a requirement to license every shipment with two-year duration licenses for traders. Combined with high global commodity prices. high inflation and a crash in the value of the Rupee.4 billion. Pakistan's economy reached a state of Balance of Payment crisis. S&P lowered Pakistan’s foreign currency debt rating to CCC-plus from B."Pakistan was the top reformer in the region and the number 10 reformer globally – making it easier to start a business. Pakistan’s local currency debt rating was lowered to B-minus from BB-minus.4 billion. averaging 7% yearly GDP growth between 2003–07. which has fallen from 60–1 USD to over 80-1 USD in a few months. Credit . exports boomed to $18 billion. The economy today Due to inflation and economic crisis worldwide. By October 2007." Doing Business The World Bank (WB) and International Finance Corporation's flagship report Ease of Doing Business Index 2010 ranked Pakistan 85 among 181 countries around the globe. the dual impact has shocked Pakistan's economy. A combination of decade-plus tax holidays." During the mid-2000s. just several notches above a level that would indicate default. it may have to seek external funding as Balance of Payments support. The Government of Pakistan has granted numerous incentives to technology companies wishing to do business in Pakistan. it was included in 2005 by the Goldman Sachs Global Economics Group as one of the "Next Eleven (N-11)" – a group of countries with economies that “might have the kind of potential for global impact that the BRICs projections highlighted. revenue generation increased to become $13 billion and attracted foreign investment of $8. increasing penalties for violating corporate governance rules. government incentives for venture capital and a variety of programs for subsidizing technical education. with gaping trade deficits. Pakistan experienced a period of tremendous growth. Since the beginning of 2008. Concurrently. the insurgency has forced massive capital flight from Pakistan to the Gulf. reducing the cost to register property. the United States. Security concerns stemming from the nation's role in the War on Terror have created great instability and led to a decline in FDI from a height of approximately $8 bn to $3. Hong Kong and United Kingdom.6 billion. Due to its large population of 186 million. "The International Monetary Fund bailed out Pakistan in November 2008 to avert a balance of payments crisis and in July last year increased the loan to $11. Exceptional policies kept Pakistan's trade deficit controlled at $13 billion. For the first time in years.5bn for the current fiscal year. are intended there. New Zealand. The top five countries are Singapore. essentially an ability to match the G7 in size”. Consequently.3 billion from an initial $7. zero duties on computer imports.
depending on the political environment. though it maintained the country’s rating at B2.5-4%. Source: . it would represent an overcoming of the present crisis wherein growth is a mere 3. the financial district of Karachi in Pakistan Mainstay of the economy – by region.agency Moody’s Investors Service cut its outlook on Pakistan’s debt to negative from stable due to political uncertainty.800 basis points. a level that indicates investors believe the country is already in or will soon be in default.The cost of protection against a default in Pakistan’s sovereign debt trades at 1. Chundrigar Road. Although less than the previous 5 year average of 7%. Economic comparison of Pakistan 1999–2008 A view of I. I. according to its five year credit default swap. The EIU estimates that inflation should drop back to single digits in 2010. and that growth should pick up to over 5% per annum by 2011. The middle term however may be less turbulent.
058 31.97 Pakistani Rupees Inflation Index (2000=100) Per Capita Income (as % of USA) 3.16 1.460 569.76 Pakistani Rupees 4.330 283.114 1.54 1.28 Pakistani 30 Rupees 21.86 Pakistani 126 Rupees Indicator GDP GDP Purchasing Power Parity (PPP) GDP per Capita Income Revenue collection Foreign reserves 1999 $ 75 billion $ 270 billion $ 450 2007 $ 160 billion $ 475.5 billion $ 925 2008 $ 170 billion $ 504 billion $1085 Rs.05 trillion $ 17.64 Pakistani 100 Rupees 59.36 1960 1965 1970 1975 1978 1985 1990 1995 2000 2005 21 2.826.461 3.111 6.91 Pakistani Rupees 9.76 Pakistani Rupees 4. 708 billion $ 1.740 51.62 Pakistani 68 Rupees 51.37 3.89 billion 2009 $ 185 billion $ 545.Year Gross Domestic Product 20.21 billion Rs.76 Pakistani Rupees 9.093 2.83 2.355 131.581.4 billion .96 billion $ 16. 305 billion Rs.029.71 16.26 2.07 1.40 3.92 2. 1.268.6 billion $1250 Rs.103 US Dollar Exchange 4.41 Pakistani 41 Rupees 30. 990 billion $ 8.
lower interest rates. after the General Elections.000 points $ 4. and an expansion in private sector lending to businesses and consumers.937 million in 2005 by the World Bank. from 2000 to 2007.741 million in 2005 thus registering over 166% growth since 2000. the corporate sector of Pakistan has declined dramatically in recent times.5 billion $ 18. Lahore Stock Exchange. rising militancy along western borders of the country. Islamabad Stock Exchange.9% in 2004–05 and averaged 8.7 billion Rs. However the market bounced back strongly in 2009 and the trend continues in 2011.5 billion $ 5. 549.5% in 1999 to a record 19. 621 billion Stock market Main articles: Karachi Stock Exchange. The Federal Bureau of Statistics valued the finance and insurance sector at Rs.6 billion $ 50. 520 billion $ 19. Manufacturing and finance Pakistan's manufacturing sector has experienced double-digit growth in recent years.19 billion $ 45.2 billion $ 75 billion at 14.311. 80 billion Rs. As a result. with large-scale manufacturing growing from a minimal 1. uncertain political environment.9 billion – – $ 18.300 points $ 5. and Sialkot Trading Floor In the first four years of the twenty-first century.17 billion 24% 53% Rs. A reduction in the fiscal deficit had resulted in less government borrowing in the domestic money market.8% by end of 2007.4 billion $ 40. .5 billion $ 11.45 billion – $ 26.1 billion – – KHI stock exchange $ 5 billion at (100-Index) 700 points Foreign Direct Investment External Debt & Liabilities Poverty level Literacy rate Development programs $ 1 billion $ 39 billion 34% 45% Rs.5 billion at 9. and mounting inflation and current account deficits resulted in the steep decline of the Karachi Stock Exchange.Exports Textile Exports $ 7. Pakistan's KSE 100 Index was the bestperforming stock market index in the world as declared by the international magazine “Business Week”.000 points $ 8.22 billion – $ 46 billion at 9. The stock market capitalisation of listed companies in Pakistan was valued at $5. But in 2008.
2005) in 2005 the World Bank considers Pakistan a medium-income country. Poverty levels have decreased by 10% since 2001 Foreign Companies which provide for Pakistani middle classes have been very successful.Middle class See also: Labour force of Pakistan As of 2011. the country ranks slightly better than the median.7 billion) on poverty alleviation programs during the past four years. Representing 11% of the population of the country. out of a population of 180 million. For example. Poverty alleviation expenditures Main article: Poverty in Pakistan Poverty in Pakistan Pakistan government spent over 1 trillion Rupees (about $16.8 million income-tax payers in the country. cutting poverty from 35% in 2000–01 to 24% in 2006. according to the Time Magazine. Demographics Main article: Demographics of Pakistan See also: Standard of living in Pakistan With a per capita GDP of over $3000 (PPP. as development there has been far slower than in the major urban areas. In late 2006. the size of the Pakistani middle class. 2006) compared with $2600 (PPP. it is also recorded as a "Medium . under prevailing economic conditions is estimated at 20 million. On measures of income inequality. the Central Board of Revenue estimated that there were almost 2. demand for Uniliver products have recently been so high that even after doubling production the Anglo-Dutch company struggled to meet demand and it's Chairman stated "Pakistanis can’t seem to have enough". Rural poverty remains a pressing issue.
Pakistan has a large informal economy.80%. Inadequate provision of social services. Mean wages were $0. Tourism Main article: Tourism in Pakistan Malam Jabba Ski Resort. and has since fallen sharply. Even though it is among the seven most populous Asian nations. close to the world average of 39. Pakistan has a family-income Gini index of 41. The population. Approximately 56% of adults are literate. and life expectancy is about 64 years. excessive red tape made firing from jobs. high birth rates and immigration from nearby countries in the past have contributed to a persistence of poverty. Relatively few resources in the past had been devoted to socio-economic development or infrastructure projects. difficult. An influential recent study concluded that the fertility rate peaked in the 1980s. In the past. and consequently hiring.Development Country" on the Human Development Index 2007.98 per manhour in 2009. Japan. and the Philippines. India. is growing at about 1. Pakistan . Kyber Pakhtunkhwa. Pakistan has a lower population density than Bangladesh. Employment The high population growth in the past few decades has ensured that a very large number of young people are now entering the labor market. High inflation and limited wage growth have drawn more women into the workforce to feed their families. In late 2006. about 168 million in 2007. which the government is trying to document and assess. Significant progress in taxation and business reforms has ensured that many firms now are not compelled to operate in the underground economy. Swat. in spite of cultural resistance and domestic abuse over the issue. the government launched an ambitious nationwide service employment scheme aimed at disbursing almost $2 billion over five years.Rate of unemployment is 25%.
Major attractions today include ruins of Indus valley civilization and mountain resorts in the Himalayas. thanks to the Hippie trail. which attract those interested in winter sports. Pakistan's cultural capital. Shalimar Gardens. attracts adventurers and mountaineers from around the world. which attracts adventurers and mountaineers from around the world. Pakistan's tourism industry was in its heyday during the 1970s when the country received unprecedented amounts of foreign tourists. people and landscapes has attracted 0. Tourism in Pakistan is still a growing industry. Karachi.3 billion) during FY 2010–2011. almost double to that of a decade ago. especially K2. the Federal board of Revenue. the second highest mountain peak in the world.1 billion) in taxes in the 2007–2008 financial year. Karachi. The revenue collection has hovered below 10% of the GDP for the past several years. The Federal . Lahore. collects almost 95% of the entire national revenue. Pakistan. Revenue Although the country is a Federation with constitutional division of taxation powers between the Federal Government and the four provinces. Pakistan is home to several mountain peaks over 7000 m. Harappa and Taxila. Tomb of Jahangir and the Lahore Fort. ancient architecture and the Hunza and Chitral valley. to the Himalayan hill stations. Himalayan and Karakoram range (which includes K2. The romance of the historic Khyber Pakhtunkhwa province is timeless and legendary. Before the Global economic crisis. the revenue department of the Federal Government. The country's attraction range from the ruin of civilization such as Mohenjo-daro. with many examples of Mughal architecture such as Badshahi Masjid. Pakistan received more than 500. Punjab province has the site of Alexander's battle on the Jhelum River and the historic city of Lahore. Peshawar and Lahore are major attractions for authentic Pakistani food and culture. while it collected about 1558 billion ($18.7 million tourists to the country. Tourism in Pakistan has been stated as being the tourism industry's "next big thing".Faisal Mosque in the capital Islamabad. Swat. with its diverse cultures. Gwadar and Rawalpindi. The north part of Pakistan has many old fortresses. Quetta. home to small pre-Islamic Animist Kalasha community claiming descent from Alexander the Great. Peshawar.000 tourists annually. The Federal Board of Revenue collected nearly one trillion rupees ($14. The main destinations of choice for these tourists were the Khyber Pass.
ISO code PKR and abbreviated Rs. 10. when the government of General Zia-ul-Haq. As a result. Foreign exchange rate The Pakistani rupee depreciated against the US dollar until the turn of the century.Board of Revenue mainly relies on indirect taxation. in the form of withholding taxes. and most of the Income Tax is also collected indirectly.000 rupee note is the largest denomination in circulation. 500. the rupee devalued by 38.10. 1000. Pakistan's central bank then stabilized by lowering interest rates and buying dollars. which is divided into 100 paisas. when Pakistan's large current-account surplus pushed the value of the rupee up versus the dollar. 5. changed it to managed float. in order to preserve the country's export competitiveness PKR per US dollar 1995–2008 Yea r Highest ↑ Date Rate Lowest ↓ Date Rate . Dollar-Rupee exchange rate The Pakistani Rupee was pegged to the Pound sterling until 1982.5% between 1982/83 many of the industries built by his predecessor suffered with a huge surge in import costs. Currently the newly printed 5. while the design work of Rs. Recently the SBP has introduced all new design notes of Rs. After years of appreciation under Zulficar Ali Bhutto and despite huge increases in foreign aid the Rupee depreciated.000 note is in progress which will help the banking industry in keeping few notes in saving accounts. stylish designs. 50. Currency system Main article: Pakistani rupee Rupee The basic unit of currency is the Rupee. and 5000 denomination. 20. The new notes have been designed using the euro technology and are made in eye-catching bright colours and bold. 100.
930 PKR 35.199 6 199 7 199 8 199 9 200 0 200 1 200 2 200 3 200 5 200 6 200 Aug 05 9 PKR 30. at the end of Prime Minister Shaukat Aziz’s tenure.000 PKR 60. Pakistan raised back its Foreign Reserves to $16.99 Billion. SBP Foreign exchange reserves By October 2007. On October 11.50 201 October Apr PKR 80. revenue generation increased to become $13 billion and the country attracted foreign investment of $8.4 billion.50 PKR 63.185 PKR 44.4 billion. exports grew to $18 billion.90 PKR 53.550 PKR 51.752 PKR 58.7238 PKR 57.6482 PKR 61.00 0 10 01 Source: PKR exchange rates in USD. In September 2010 According the State Bank Of Pakistan Pakistan's Foreign Reserves Stood at $16. Pakistan's trade deficit was at $13 billion. 2008 State Bank of Pakistan reported that country's foreign .9272 PKR 59.75 Nov 01 PKR 60.266 PKR 40.
and the share of agriculture has dropped to roughly one-fifth of Pakistan's economy. Over 1. While per-capita agricultural output has grown since then. In recent years. and finance).081 patent applications were filed by non-resident Pakistanis in 2004 revealing a new-found confidence. the country has seen rapid growth in industries (such as apparel. textiles. Sectors See also: List of Pakistani companies Agriculture Main article: Agriculture in Pakistan Agriculture by Province .59 billion. and cement) and services (such as telecommunications. advertising.exchange reserves had gone down by $571. The foreign exchange reserves had declined more by $10 billion to an alarming rate of $6. transportation.7 Million. Agriculture accounted for about 53% of GDP in 1947. it has been outpaced by the growth of the non-agricultural sectors.9 Million to $7749. Structure of economy The economy of the Islamic Republic of Pakistan is suffering with high inflation rates well above 26%.
Mango Orchard in Multan. Pakistan Pakistan is one of the world's largest producers of the following commodities according to FAOSTAT. . clementine (9th) Wheat (10th) Pakistan's principal natural resources are arable land and water. About 25% of Pakistan's total land area is under cultivation and is watered by one of the largest irrigation systems in the world. as per Forbes Global 2000 ranking for 2011. dry (4th) Oranges (11th) Rice. given here with the 2008 ranking: • • • • • • • • • • • • • Apricot (3rd) Buffalo Milk (2nd) Chickpea (3rd) Cotton.paddy (11th) Sugarcane (5th) Tangerines. Pakistan irrigates three times more acres than Russia. mandarin orange. lint (4th) Cotton. Zarai Taraqiati Bank Limited is the largest financial institution geared towards the development of agriculture sector through provision of financial services and technical expertise. Agriculture accounts for about 23% of GDP and employs about 44% of the labor force. Seed (3rd) Dates (5th) Mango (6th) Onion. the statistical arm of the Food and Agriculture Organization of The United Nations. Industry Main article: Industry of Pakistan Manufacturing by Province Pakistan's two leading companies.
contributes 16% to the manufacturing sector which also is expected to increase 25% in the next 7 years. clothing. Cotton textile production and apparel manufacturing are Pakistan's largest industries. Car ownership in Pakistan has risen by 40% per annum since 2001. the share in the annual GDP is 40% likewise SMEs generating significant employment opportunities for skilled workers and entrepreneurs. fertilizer. The government is privatizing large-scale parastatal units. cement. Government policies aim to diversify the country's industrial base and bolster export industries.food processing. The total contribution of Auto industry to GDP in 2007 is 2. tobacco. steel. sugar. accounting for about 66% of the merchandise exports and almost 40% of the employed labour force.429 1.5% of the GDP). Small and medium scale firms represent nearly 90% of all the enterprises in Pakistan and employ 80% of the non-agricultural labour force. Other major industries include cement. beverages.995 Forbes Global 2000 Company Name Oil & Gas Development PSO Pakistan's industrial sector accounts for about 24% of GDP.6% in the next 5 years. . edible oil. while growth in overall industrial output (including the private sector) has accelerated.9% (2005) SME Sector In Pakistan SMEs have a significant contribution in the total GDP of Pakistan. • • • Industries: textiles (8. machinery. paper products. Auto sector presently. These figures indicate the potential and further growth in this sector. dairy products. according to SMEDA and Economic survey reports. and the public sector accounts for a shrinking proportion of industrial output. and food processing. construction materials.  Automotive industry Main article: Automotive industry in Pakistan Pakistan is an emerging market for automobiles and automotive parts offers immense business and investment opportunities.Global ranking 1. oil refineries.8% which is likely to increase up to 5. shrimp Industrial production growth rate: 6% (2005) Large-scale manufacturing growth rate: 19. fertilizer. chemicals.
A marked increase in software export figures are an indication of this booming industry’s potential. Textile exports in 1999 were $5. The total number of IT companies increased to 1306 and the total estimated size of IT industry is $2. The cement sector consisting of 27 plants is contributing above Rs 30 billion to the national exchequer in the form of taxes. Pakistan had inherited four cement plants with a total capacity of 0.000 people in Pakistan. Textile exports share in total export of Pakistan has declined from 67% in 1997 to 55% in 2008. In the period July 2007 – June 2008. Textile exports managed to increase at a very decent growth of 16% in 2006. and if we are not able to fulfill our current orders. Pakistan is one of the largest users of CNG (compressed natural gas) in the world. textile exports were US$10. we will lose international buyers. more than 3. IT industry Main article: Information technology in Pakistan Pakistan’s IT industry has been rising steadily since the last three years.S.2 billion and rose to become $10. or 4 – $ 5 billion for the fiscal year ending June 20 next year. Pakistan was for the first time featured in the Global Services Location Index by A. Textiles The Textile Industry is dominated by Punjab. Sui Northern Gas Pipelines Ltd. as exports of other textile sectors grew. “Monthly loss the textile industry because of interruptions in gas supply could reach about U.000 CNG stations are operating in the country in 99 cities and towns. Some expansion took place in 1956–66 but could not keep pace with the economic development and the country had to resort to imports of cement in 1976–77 and continued to do so till 1994–95. 3% of United States imports regarding clothing and other form of textiles is covered by Pakistan. In 2007. Presently. » (SNGPL) notified the textile mills to reduce the supply of gas for five months. and 1000 more would be set up in the next two years. Pakistan had improved its rank by ten places to reach 20th.But now this excess use of this valuable resource in transport made the power sector very dangling. The major reason of decline of textile export of Pakistan is the Govt unhealthy policies. Head of All Pakistan Textile Association of Enterprises Anis-ul-Haq has expressed concern about the decision: “Now is the time to the textile industry out of a three-year downturn. It has provided employment to over 50. $ 1 billion.CNG industry As of 2010.8 billion. Mining Main article: Mining in Pakistan . By 2009. Cement industry In 1947. Kearney and was rated as the 30th best location for offshoring.T.5 billion by 2007.62 billion. The demand for textile products is growing.5 million tons.
The discovery of coal deposits having over 175 billion tones of reserves at Thar in the Sindh province has given an impetus to develop it as an alternate source of energy.3% of GDP.5% and likely to increase considerably on the development and commercial exploitation of Saindak & Reco Diq copper and gold deposits (world's largest gold mine). The major production is of coal. and wholesale and retail trade about 30%. Services Service Sector by Province Pakistan's service sector accounts for about 53. Thar coal and gemstone deposits. In the recent past. Transport. . minerals are a provincial subject. The current contribution of the mineral sector to the GDB is about 0. communications. providing appropriate institutional and regulatory framework and equitable and internationally competitive fiscal regime. Recent discoveries of a thick oxidized zone underlain by sulphide zones in the shield area of the Punjab province. enforcing regulatory regime. besides. rock salt and other industrial and construction minerals. the country's more than 6. Provincial governments are responsible for development and exploitation of minerals. International mining companies have responded favorably to the NMP and presently at least four are engaged in mineral projects development. Pakistan has a large base for industrial minerals. The enforcement of Mineral Policy (1995) has paved the way to expand mining sector activities and attract international investment in this sector.00. There is vast potential for precious and dimension stones. Currently about 52 minerals are under exploitation although on small scale. under the constitution of the Islamic Republic of Pakistan. finance.000 km² of outcrops area demonstrates varied geological potential for metallic and non-metallic mineral deposits. storage. covered by thick alluvial cover have opened new vistas for metallic minerals exploration. Based on available information.Pakistan is endowed with significant mineral resources and is emerging as a very promising area for prospecting/exploration for mineral deposits. In line with the constitutional framework the federal and provincial governments have jointly set out Pakistan's first National Mineral Policy in 1995. Duddar zinc lead. exploration by government agencies as well as by multinational mining companies presents ample evidence of the occurrences of sizeable minerals deposits. duly implemented by the provinces. gas and nuclear minerals regulated at federal level. and insurance account for 24% of this sector. Except oil.
2. the sector has seen an exponential growth.  The contribution of the telecom sector to the national exchequer increased to Rs 110 billion in the year-end 2007–08 on account of the general sales tax. 4. the following are the top mobile phone operators: 1. In addition.Pakistan is trying to promote the information industry and other modern service industries through incentives such as long-term tax holidays. Pakistan/UAE) Telenor (Parent: Telenor. In Pakistan. Mobilink (Parent: Orascom Telecom Holding. China) . Norway) Warid (Parent: Abu Dhabi Group / SingTel. activation charges and other steps as compared to Rs 100 billion in the year-end 2006–07. Communication Main article: Communications in Pakistan PTCL's One Stop Shop in Islamabad After the deregulation of the telecommunication industry. one of the highest mobile teledensities in the entire world. Pakistan Telecommunication Company Ltd has emerged as a successful Forbes 2000 conglomerate with over US $1 billion in sales in 2005. 5. Egypt) Ufone (Parent: PTCL (Etisalat). The World Bank estimates that it takes about 3 days to get a phone connection in Pakistan. The mobile telephone market has exploded fourteen-fold since 2000 to reach a subscriber base of 91 million users in 2008. The government is acutely conscious of the immense job growth opportunities in service sector and has launched aggressive privatisation of telecommunications. UAE/Singapore) Zong (Parent: China Mobile. there are over 6 million landlines in the country with 100% fibre-optic network and coverage via WLL in even the remotest areas. As a result. 3. utilities and banking despite union unrest. Pakistan won the prestigious Government Leadership award of GSM Association in 2006.
As of 2007 there were six cell phone companies operating in the country with nearly 90 million mobile phone users in the country. over the past four years. The rankings are released by Point Topic Global broadband analysis. According to the PC World. The Federal Bureau of Statistics provisionally valued this sector at Rs.1 million fixed lines. With a rapid increase in the number of Internet users and ISPs.000 jobs indirectly. Pakistan was amongst the top five ranker with one of the highest SMS traffic with 763 million messages.By March 2009. leading to a major re-alignment of the tradition of arranged marriages. Pakistani society has seen an unparalleled revolution in communications. • • • • • • Pakistan has more than 20 million Internet users in 2009. while as many as 2. Paging and mobile (cellular) telephones were adopted early and freely. Sony Ericsson. Cellular phones and the Internet were adopted through a rather laissez-faire policy with a proliferation of private service providers that led to the fast adoption.62 billion in Foreign Direct Investment (FDI) – about 30% of the country’s total foreign direct investment. Pakistan is ranked 4th in terms of broadband Internet growth in the world. The use of search engines and instant messaging services is also booming.5 million. During 2007–08. . and a large English-speaking population. The country is said to have a potential to absorb up to 50 million mobile phone Internet users in the next 5 years thus a potential of nearly 1 million connections per month. communicating with users all over the world. for example. a global research centre.982. Telecom industry created of 80. the Local Loop installed capacity reached around 5. Present growth of state-of-the-art infrastructures in the telecoms sector during the last four years has been the result of the PTA's vision and implementation of the deregulation policy.353 million in 2005 thus registering over 91% growth since 2000. a total of 6.4 million are using Wireless Local Loop connections. Since liberalisation. as the subscriber base of broadband Internet has been increasing rapidly. Pakistanis are some of the most ardent chatters on the Internet. Recent years have seen a huge increase in the use of online marriage services.000 jobs directly and 500. Nokia and Motorola along with Samsung and LG remain the most popular brands among customers. organisations and institutions have their own websites.37 billion text messages were sent through Acision messaging systems across Asia Pacific over the 2008/2009 Christmas and New Year period. the Pakistani communication sector alone received $1. In addition to the 3. Wireless local loop and the landline telephony sector has also been liberalized and private sector has entered thus increasing the teledensity rate. Almost all of the main government departments. the Pakistani telecom sector has attracted more than $9 billion in foreign investments. In mid2008. Pakistan had 91 million mobile subscribers – 25 million more subscribers than reported in the same period in 2008. Pakistan is on the verge of a telecom revolution and is by far the most attractive sector in Pakistan in terms of Foreign Direct Investment coming into the country.
which serves the main cities within Pakistan in addition to destinations in the Gulf and Manchester in the United Kingdom. Foreign exchange reserves continued to reach new levels in 2007.358. the flagship airline of Pakistan's civil aviation industry. Private sector airlines in Pakistan include Airblue. finance and insurance Main articles: Banking in Pakistan and Insurance in Pakistan See also: List of banks in Pakistan A reduction in the fiscal deficit has resulted in less government borrowing in the domestic money market. and would also would serve as an effective link for the exports to Europe (as Turkey part of Europe and Asia]. tourism. has turnover exceeding $1 billion in 2005.Furthermore it would promote trade. The government announced a new shipping policy in 2006 permitting banks and financial institutions to mortgage ships.1. Aviation See also: List of airlines of Pakistan A PIA B747-367 at the Domestic Satellite of Jinnah International Airport Pakistan International Airlines. and an expansion in private sector lending to businesses and consumers. The other private carrier is Shaheen Air International whose network covers the main cities of Pakistan and the Gulf.309 million in 2005 thus registering over 96% growth since 2000. .Railways Main article: Pakistan Railways A massive rehabilitation plan worth $1 billion over five years for Pakistan Railways has been announced by the government in 2005. Banking. A new rail link trial has been established from Islamabad-Pakistan via Teharan-Iran Via Istanbul-Turkey . Wholesale and retail trade The Federal Bureau of Statistics provisionally valued this sector at Rs. lower interest rates. supported by robust export growth and steady worker remittances.
 Nevertheless. The report noted that the present housing stock is also rapidly aging and an estimate suggests that more than 50% of stock is over 50 years old. is beyond the financial resources of the government. This necessitates putting in place a framework to facilitate financing in the formal private sector and mobilise non-government resources for a market-based housing finance system. Banking sector turned profitable in 2002. allowing for a consumption boom (more than a 7-month waiting list for certain car models) as well as a construction bonanza.741 million in 2005 thus registering over 166% growth since 2000. Since 2000 Pakistani banks have begun aggressive marketing of consumer finance to the emerging middle class.1 billion) billion in 2006. Stress tests conducted on June 2008 data indicate that the large banks are relatively robust. 42nd in non banks and 17th in Financial Markets.185. particularly in metropolises like Lahore.Pakistan has been ranked 34 out of 52 countries in the World Economic Forum's first Financial Development Report. Under Factors. The Federal Bureau of Statistics provisionally valued this sector at Rs.376 million in 2005 thus registering over 49% growth since 2000.5 million units annually to address 6.311. The Federal Bureau of Statistics provisionally valued this sector at Rs. The credit card market continued its strong growth with sales crossing the 1 million mark in mid2005. Pakistan's banking sector has remained remarkably strong and resilient during the world financial crisis in 2008–09.389.1 ($1. which was released in Pakistan through the Competitiveness Support Fund (CSF) in December 2008. It is also estimated that 50% of the urban population now lives in slums and squatter settlements. a feature which has served to attract a substantial amount of FDI in the sector. Public administration and defence The Federal Bureau of Statistics provisionally valued this sector at Rs. The report said that meeting the backlog in housing. Their profits continued to rise for the next five years and peaked to Rs 84. with the medium and small-sized banks positioning themselves in niche markets. . Under Capital Availability and Access. the Karachi Chamber of Commerce and Industry estimated in late 2006 that the overall production of housing units in Pakistan has to be increased to 0. Policies and Institutions pillar. Ownership of dwellings Main article: Housing in Pakistan The property sector has expanded twenty-threefold since 2001. 50th in business environment and 37th in Financial Stability.545 million in 2005 thus registering over 65% growth since 2000.1 million backlog of housing in Pakistan for meeting the housing shortfall in next 20 years. Pakistan ranks 49th in institutional environment. Pakistan ranks 33rd. In the Financial Intermediation Pillar Pakistan ranks 25th in banks. besides replacement of out-lived housing units.
Pakistan faces a significant challenge in revamping its network responsible for the supply of electricity. and investment of up to 100% of equity participation is allowed in most sectors. While the government claims credit for overseeing a turnaround in the economy through a comprehensive recovery.1 million in the corresponding period last year. service fees or capital is now . Pakistan has achieved FDI of almost $8. If the rich people in Pakistan are shifted to solar Engery that they should be forced to purchase solar panels. whereas it was $108. the matter of balancing Pakistan's supply against the demand for electricity has remained a largely unresolved matter.6 per cent year-on-year to US$2.07 children born/woman and higher in earlier years greatly reduces government ability to finance major new expansion and maintenance of electricity grid and free education and health of Pakistanis. surpassing the government target of $4 billion.631. Electricity Main article: Electricity sector in Pakistan For years. dropping by 54.224 billion from only $792. especially since 1999. Pakistan is now the most investment-friendly nation in South Asia.22 billion and portfolio investment by 276 per cent to $407.6% due to Pakistan's political instability and weak law and order.4 million. Most barriers to the flow of capital and international direct investment have been removed. it has just failed to oversee a similar improvement in the quality of the network for electricity supply. No politician or government official highlights Pakistan's wasted opportunities in education and human development because population increase of 3. aid. During July–March 2005– 06. this will make the economy boost again as before 2007. Chemicals and pharmaceuticals Main article: Pharmaceutical industry in Pakistan Foreign trade. according to the latest statistics released by the State Bank.4 billion in the financial year 06/07. the shortfall can be controlled. Foreign investors do not face any restrictions on the inflow of capital. according to the Bank of Pakistan. FDI year-on-year increased to $2. remittances. and investment Investment Foreign direct investment (FDI) in Pakistan soared by 180.229 million in 2005 thus registering over 78% growth since 2000. the State Bank of Pakistan (SBP) reported on April 24.6 million and portfolio investment to $407.4 million during the first nine months of fiscal year 2006. community and personal services The Federal Bureau of Statistics provisionally valued this sector at Rs. Unlimited remittance of profits. Business regulations have been profoundly overhauled along liberal lines.Social. Foreign investment had significantly declined by 2010. which would suggest good conditions for investment in solar energy. Similar to other developing countries Pakistan can not plan or control its high population growth. Most cities in Pakistan receive substantial sunlight throughout the year. dividends.
6% shares of Lakson Tobacco Company acquired by Philip Morris International for $382 million The foreign exchange receipts from these sales are also helping cover the current account deficit. The privatisation process. has gained momentum. majority stakes in many corporations have been acquired by multinational groups. which started in the early 1990s. In recent years. Pakistan has been able to attract a large portion of the global private equity investments because of economic reforms initiated in 2003 that have provided foreign investors with greater assurances for the stability of the nation and their ability to repatriate invested funds in the future. foreign investors are taking a keen interest in the corporate sector of Pakistan. with most of the banking system privately owned.the rule. with a maximum of 25% (except for the car industry). Business regulations are now among the most liberal in the region. Foreign trade Main article: Foreign trade of Pakistan . and the oil sector targeted to be the next big privatisation operation.8 billion Additional 57. Pakistan is attracting an increasingly large amount of private equity and was the ranked as number 20 in the world based on the amount of private equity entering the nation. The recent improvements in the economy and the business environment have been recognised by international rating agencies such as Moody’s and Standard and Poor’s (country risk upgrade at the end of 2003). This was confirmed by the World Bank's Ease of Doing Business Index report published in September 2009 ranking Pakistan (at 85th) well ahead of neighbours like China (at 89th) and India (at 133rd). • • • • • • PICIC by Singapore based Temasek Holdings for $339 million Union Bank by Standard Chartered Bank for $487 million Prime Commercial Bank by ABN Amro for $228 million PakTel by China Mobile for $460 million PTCL by Etisalat for $1. Foreign acquisitions and mergers With the rapid growth in Pakistan's economy. Tariffs have been reduced to an average rate of 16%.
The budget deficit in fiscal year 2005–06 is expected to be over 4% of GDP. This deficit amounted to over €15 billion in 2010. All new U.S. industrial raw materials.S.1% in FY 2002–03. in its war on terror. The sanctions were lifted by president George W. and the impact of occasional droughts on its agricultural production have all contributed to variability in Pakistan's trade deficit. the World Bank. Despite the country's current account surplus and increased exports in recent years. The budget deficit in fiscal year 2004–2005 was 3. more than double the amount paid in FY 1989–90. despite government diversification efforts. and additional sanctions were imposed after Pakistan's May 1998 nuclear weapons tests. and has bilateral and multilateral trade agreements with many nations and international organizations. Bush after Pakistani president Musharraf allied Pakistan with the U. the IMF. Principal and interest payments in FY 1998–99 totaled $2.6 billion. economic assistance to Pakistan was suspended after October 1990. The government is also reducing tariff barriers with bilateral and multilateral agreements. fertilizer. and consequently the IMF program was ended. Pakistan's exports continue to be dominated by cotton textiles and apparel. greater transparency and other governance reforms have led to upgrades in Pakistan's credit rating. Major imports include petroleum and petroleum products.4% of GDP. In the late 1990s Pakistan received about $2. it still has a large merchandise-trade deficit. and consumer products. The budget deficit in fiscal year 2003–04 is expected to be around 4% of GDP. capital goods. domestic political uncertainty. chemicals. In the six months to December 2003. Pakistan recorded a current account surplus of $1. Past external imbalances left Pakistan with a large foreign debt burden. edible oil. roughly 5% of GDP. and the Asian Development Bank) and bilateral donors. . the government refused further IMF assistance. Economists believe that the soaring trade deficit would have an adverse impact on Pakistani rupee by depreciating its value against dollar (1 US $ = 60 Rupees (March 2006) ) and other currencies.. The budget deficit in fiscal year 1996–97 was 6.5 billion per year in loan/grant assistance from international financial institutions (e. the composition of assistance to Pakistan shifted away from grants toward loans repayable in foreign exchange. these factors have enabled Pakistan to prepay.g.Pakistani exports in 2005 Pakistan is a member of the World Trade Organization. Improved fiscal management. Increasingly. Together with lower global interest rates.761 billion. Fluctuating world demand for its exports. Annual debt service peaked at over 34% of export earnings before declining. Pakistan's hard currency reserves have grown rapidly. Exports grew by 19.4% of GDP. refinance and reschedule its debts to its advantage. Having improved its finances. While the country has a current account surplus and both imports and exports have grown rapidly in recent years. Pakistan still has a large merchandise-trade deficit. With a current account surplus in recent years[clarification needed].
tanks. machinery and automobiles. tiles. leather goods. carpets and rugs.39 billion despite the fact that the country received $10. furniture. surgical instruments.024 trillion as of March 31. sports goods (renowned for footballs/soccer balls). cotton fiber. wheat. In August 2007. In 2010. cement. textiles. cutlery. The Petroleum Ministry says that this year the bill of oil imports was expected to reach $6. powdered milk. Pakistan started exporting cement to India to fill in the shortage there caused by the building boom.055 trillion in 2007-2008. the EU accounted for 12. seafood (especially shrimp/prawns). an official said. especially tents. engineering goods. 2011-2012 from Rs6.8 billion in workers’ remittances in 10 months of the current financial. which is the main reason behind the all-time high trade deficit. The trade deficit has increased by 14. As of April 2011.4% of Pakistani imports and 22. In 2009/2010 the export target of Pakistan was US $20 billion. chicken.6 billion in the last fiscal year. The rise in the trade gap was also fuelled by high oil import prices. defense equipment (submarines.5 percent and current account deficit has swelled by $3.5 billion against $4. clothing. Exports Graphical depiction of Pakistan's product exports in 28 color coded categories. marble. vegetables. The EU is the single largest trading partner of Pakistan absorbing over one-third of the exports in 2003. Russia is a growing market for Pakistani exporters. radars).6% of its exports.One of the main reasons that contributed to the increase in trade deficit is the increased imports of earthquake relief related items. oranges.Pakistans exports stand at US $25 billion. Pakistan's exports increased more than 100% from $7. The public debt of the country has surged by almost 100 percent to Rs12. 2005 in Azad Jammu and Kashmir and parts of Khyber-Pakhtunkhwa.5 billion in 1999 to stand at $18 billion in the financial year 2007–2008. salt. food items. tarpaulin and plastic sheets to provide temporary shelter to the survivors of earthquake of October 8. Pakistan exports rice. software. Pakistan produces and exports cements to Asia and the Middle East. mangoes. . livestock meat. Pakistani-assembled Suzukis (to Afghanistan and other countries). electrical appliances. processed food items. ice cream. and many other items. onyx.
depending on the political environment.490 billion.External Imbalances Pakistan suffered a merchandise trade deficit of $13. the unprecedented floods of 2010 which encapsulated 20% of Pakistan's land area. which has fallen from 60–1 USD to over 80-1 USD in a few months.136 (Goods and services). just several notches above a level that would indicate default. have caused a monetary damage estimated to be in excess of $10bn. Much like previous natural disasters which have afflicted Pakistan. Economic aid Main article: Foreign aid to Pakistan . though it maintained the country’s rating at B2.125 billion which equals the services export of $4. Security concerns stemming from the nation's role in the War on Terror have created great instability and led to a decline in FDI from a height of approximately $8 bn to $3.800 basis points. Consequently. and rise in the prices of food items. the philanthropic nature of Pakistani people and widespread coverage by a fiercely independent and established media has proven yet again that Pakistan is an incredibly resilient nation. machinery and automobiles. it may have to seek external funding as Balance of Payments support.The cost of protection against a default in Pakistan’s sovereign debt trades at 1. the floods of 2010 inflicted damage of epic proportions. Combined with high global commodity prices. Pakistan’s local currency debt rating was lowered to B-minus from BB-minus. as a result of which real growth is almost flat and EIU's original targets will have to be revised.653 billion which is approx 83. S&P lowered Pakistan’s foreign currency debt rating to CCC-plus from B. Services sector deficit for 2006–2007 stood at $4.5bn for the current fiscal year. and that growth would pick up to over 5% per annum by 2011. The combined deficit in services and goods stand at $17. For the first time in years. according to its five year credit default swap. The gap has considerably widened since 2002-3 when the deficit was only $1. a level that indicates investors believe the country is already in or will soon be in default. the dual impact has shocked Pakistan's economy.125 billion for the same year. The middle term however may be less turbulent.528 billion for the financial year 2006-7. Concurrently. the insurgency has forced massive capital flight from Pakistan to the Gulf. high inflation and a crash in the value of the Rupee. Pakistan's economic outlook has taken a dramatic downturn. However.06 billion. Since the beginning of 2008. The rise in the trade gap has been attributed to high oil import bill. The EIU hsd estimated that inflation should drop back to single digits in 2010. Credit agency Moody’s Investors Service cut its outlook on Pakistan’s debt to negative from stable due to political uncertainty.5% of country's total export of $21.016 billion up by 41% over previous year's $4. However. Current account – Current account deficit for 2006-7 reached $7. with gaping trade deficits.
 In November 2008. which was the third consecutive month that remittances crossed this mark. Remittances The remittances of Pakistanis living abroad has played important role in Pakistan's economy and foreign exchange reserves. The major source countries of remittances to Pakistan include UAE. $1. World Bank (WB).6 billion in aid. swift processing and transfer of money by the banking channel and incentives for overseas Pakistanis have encouraged them to utilise legal channels. Japan will provide $500 million annual economic aid to Pakistan. The State Bank of Pakistan (SBP) has announced that remittances sent home by overseas Pakistani workers have crossed the $10 billion mark for the first time in the country’s history as the figure reached $10. . In comparison. In May. USA. aid strategy showing a significant increase in funding aimed largely at beefing up the country's infrastructure. $1. $1. contributed US$11.03 billion and $1. they say. provides long term loans to Pakistan.07 billion or 25 per cent more than $8.72 billion. The World Bank unveiled a lending program of up to $6. Qatar and Oman). etc. USA. Pakistan also receives bilateral aid from developed and oil-rich countries.18 billion.2 billion to the economy in FY2011. $1.33 billion. Asian Development Bank (ADB). .86 billion. which would help Pakistan move forward on its way to self-reliance. the International Monetary Fund (IMF) has approved a loan of 7. April and May respectively. to help stabilize and rebuild the country's economy. etc. Australia. UK and EU countries were $2. Saudi Arabia.93 million respectively. while reports said Saudi Arabia had pledged $700m over two years.61 billion. The 7 million strong Pakistani diaspora. GCC countries (including Bahrain. UAE. The country received $1.05 billion. Australia. Since 1973 the Pakistani workers in the oil rich Arab states have been sources of billions dollars of remittances. analysts say that a crackdown on the illegal Hundi and Hawala money transfer systems. remittances from Saudi Arabia. Citing reasons for the sharp increase in remittances. Remittances received from Norway.38 billion. Switzerland.5bn already promised to Pakistan for each of the next five years.Pakistan receives economic aid from several sources as loans and grants. Canada. Kuwait.74 million respectively in July–May 2009–10. GCC countries (including Bahrain. $1.6 Billion to Pakistan. 2006–2009.1 billion in 11 months (July–May) of the current financial year. The Pakistanis settled in Western Europe and North America are important sources of remittances to Pakistan. Kuwait.09 billion worth of remittances received in the same period of the previous year. Japan. The European Union promised $640m over four years. More recently the government of Pakistan received an economic aid of US $5bn dollars out of which the US pledge of $1bn was described as a down-payment on the previously announced $1.5 billion for Pakistan under a new four-year. The International Monetary Fund (IMF). $793. In the July– May period. overseas workers remitted over $1 billion. UK and EU countries like Norway. The flow of charity money after last summer floods has also given a boost to the remittances this year. remittances stood at $1. $1.84 billion. Overall Friends of Pakistan had pledged $1.09 billion and $320. Switzerland. $1.05 billion in March. The 11-month figure was $2. $2.91 million and $229. Qatar and Oman). The Asian Development Bank will provide close to $6 billion development assistance to Pakistan during 2006–9.13 billion.
State Bank of Pakistan (SBP) Yaseen Anwar said during first ten months of FY2011/12. tax collection (see table below for the government's estimation of the cost of ‘War on Terror’ to Pakistan as published in an IMF report). Recently. Government finances Fiscal budget summary • • • • • • Fiscal year: 1 July – 30 June Budget outlay: Rs 3.86 million against $740. which helped Balance of Payments (BoP) despite widening of trade deficit.88 billion. This spillover to the rest of economy is equally clear.2 billion (FY2010/11) Revenues and taxation Main article: Taxation in Pakistan Pakistan has a low tax/GDP ratio. privatization. with the war on terror having engulfed Pakistan's economy. industrial output.2% to $10. foreign investment. Governor.52 114.8 billion Expenditures: Debt – external: $50 billion (2010 est.03 .) Economic aid – recipient: $1. Pakistan's coalition government proposed the idea of imposing a Reformed General Sales tax which was modelled along the lines of VAT.96 million in the same period last year. which it is trying to improve.499 108. However. Japan and other countries during the 11 months amounted to $926.259 trillion (FY2010/11) Revenues: $19.060 82. the war on terror cost the Pakistani economy nearly US$8 billion a year in terms of lost exports. According to government estimates.) Pakistan has sustained immense socio-economic costs of being a partner in the international counter terrorism campaign.103 78. Pakistan’s fiscal challenges are well known and documented. He explained that at start of year (July 2011). (Rs billion) 2004/ 2005/ 2006/ 2007/ 2008/ 05 06 07 08 09 Direct Cost 67. external conditions appeared daunting due to rising oil prices and lack of external financing. the politically unpopular bill was not approved in the senate/parliament and has afforded some respite to the people of Pakistan who are already suffering from a stagnant economy and rampant inflation. Expenditures (and the economic costs of War on Terror) Government expenditures were $25 billion (2006 est.Canada. remittances from overseas Pakistanis rose by 20. The current tax-to-GDP ration is estimated to be between 8%–9% which is far below developing other countries of the region such as India (15%) and Sri Lanka (18%).
privatization. The bonds.84 563. Details of amount raised in various issues is as follows: 1999 – $6230 million 2004 – $5000 million @ 6. 2006 that analysts said should ensure a favorable reception in the bond market.875%.875%. tax collection.25 billion had been anticipated for what is Pakistan’s third foray into the international debt market since 2004. There has also been massive unemployment in the terror-inflicted regions.89 484. 2006. had generated $1.10 300. consisting of 10-year and 30-year tranches.72 278.79 3 0 9 7 3 '*On account of loss of exports.36 677. the anti-terrorist campaign following the 9/11 attacks in the United States strained Pakistan’s budget. as frequent bombings and worsening law and order situation have taken a toll on the socio-economic fabric of the country. The 10-year tranche would be $50000 million and the 30-year portion $250 million.78 360. as allocations for law enforcement agencies had to be increased significantly.75% 2005 – $6000 million worth Islamic bonds 2007 – $ 7500 million @ 6. eroding resources for development in the country.40 375. etc.5 billion in orders and a total size of as much as $1. The heightened sense of uncertainty has contributed to capital flight and slowed down domestic economic activity.76 0 0 0 0 0 259. The sources said that the 10-year tranche was expected to be priced at around 100125%.875% worth Euro Bonds which were highly over subscribed . According to the IMF. foreign investment.7 Indirect Cost* Total 3 192. development projects are afflicted with delays which ultimately resulted in large cost over-runs. while the longer-dated tranche was expected to be sold at around 70. industrial output.75 to 10. the top end of the indicative yield range of 3. Pricing is expected during New York trading hours on March 23. In addition to human sufferings and resettlement costs. creating unease among foreign investors.00 222. Government of Pakistan has been raising money from the international debt market from time to time. Sovereign bonds Pakistan is expected to sell a dual-tranche sovereign bond worth $750 million on March 23.
Income distribution • • Gini Index: 41 Household income or consumption by percentage share: o lowest 10%: 4.5% .1% o highest 10%: 27.7% (1996) o middle 10%: 10.
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