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Economic history of Pakistan

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Title: Economic history of Pakistan  
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Subject: Economy of Pakistan, Periods of stagflation in Pakistan, Privatisation in Pakistan, Nationalisation in Pakistan, Islamic economics in Pakistan
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Economic history of Pakistan

The economic history of Pakistan begins with the country's independence in 1947. The economy of Pakistan is a semi-industrialised one, based heavily on textiles, agriculture and food production, though recent years have seen a surge towards technological diversification. The land forming modern-day Pakistan was home to the ancient Indus Valley Civilisation from 2800 BC to 1800 BC; historical evidence suggests that the civilisation relied on and carried trade through the Indus River, and its inhabitants were some of the most resourceful traders.

First five decades

Pakistan's average economic growth rate since independence has been higher than the average growth rate of the world economy during the same period. Average annual real GDP growth rates[1] 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[2]

During the 1960s, Pakistan was seen as a model of economic development around the world, and there was much praise for its economic progression. The capital 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"; the World Financial Centre in Seoul is 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 1990s. Two wars with India - the Second Kashmir War in 1965 and the Bangladesh Liberation War in 1971 - and the resultant separation of Bangladesh from Pakistan also adversely affected economic growth.[3] In particular, the latter war brought the economy close to recession, although economic output rebounded sharply until the nationalisations of the mid-1970s. 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.

References

  1. ^ 2005-06 Economic and Social Indicators of Pakistan
  2. ^ National Accounts (current prices)
  3. ^ Pakistan Embassy


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