Pakistan Economic History

Economic play a very vital and important role in any country development, international relations and its own people health & wealth. This world after becoming global village, no country stays alone or survive without international relations, these relations depends upon country economy and its economic conditions and parameters. All the sector of life effect the country economic conditions weather it is agriculture, population, tourism, sports, weather, political conditions or its geographical position.

Pakistan due to its geographical position, population strength and economic conditions always plays a vital role in international relations and get influenced by the changes take place in the world. Since independence of Pakistan our economy faces complex situations sometime it’s hard and sometimes it’s booming, it was due to our policy shifting or unstable political conditions with relation to international politics.

Pakistan economic history is very attention-grabbing; there was only two year in our history when our exports were grater then our imports (trade balance was in our favour). Up to 1954 our balance of payment was in favour of Pakistan but after that political uncertainties and uncertain economic policies disturb everything. Our exports based heavily on textiles, agriculture and food production, and our imports based on Fuel & Energy, Machinery, Equipments, and Arms & Ammonisation.

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 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.

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 modelled after Karachi.

Two wars with India - the Kashmir War in 1965 and the Bangladesh Liberation War in 1971 - adversely affected economic growth. In particular, the latter war brought the economy close to recession, although economic output rebounded sharply until the nationalisations of the mid-1970s but as the result of nationalisation Pakistan economy suffer very badly and most of the profitable and growing organizations turn into Burdon on economy which stop the growth and then turn our economy in debit. In the ends of the 1980s via a policy of deregulation economy again start recovering, as well as an increased inflow of foreign aid and remittances from expatriate workers. Economic mismanagement in general, fiscally imprudent economic policies in particular and political uncertainty caused a large increase in the country's public debt and led to slower growth from the 1990s.

After 1990s main cause of our economic destabilization were increase in import of luxury items, none sporting of local industry, inappropriate bank policies for consumer loans (Credit cards, car financing), Govt. policy toward Industrial Banks and most important Energy crises (last two govt. Not even start a single project of electricity production).

Supporting economy with unrealistic means and manipulating facts and figures never creates any good or long-lasting impact on general public economic conditions always result in big downfall and recession.