Pakistan, an impoverished and underdeveloped country, suffers from internal political disputes, low levels of foreign investment, and a costly, ongoing confrontation with neighboring India. Pakistan's economic prospects, although still marred by poor human development indicators, continued to improve in 2002 following unprecedented inflows of foreign assistance beginning in 2001. Foreign exchange reserves have grown to record levels, supported largely by fast growth in recorded worker remittances. Trade levels rebounded after a sharp decline in late 2001. The government has made significant inroads in macroeconomic reform since 2000, but progress is beginning to slow. Although it is in the second year of its $1.3 billion IMF Poverty Reduction and Growth Facility, Islamabad continues to require waivers for politically difficult reforms. Long-term prospects remain uncertain as development spending remains low, regional tensions remain high, and political tensions weaken Pakistan's commitment to lender-recommended economic reforms. GDP growth will continue to hinge on crop performance; dependence on foreign oil leaves the import bill vulnerable to fluctuating oil prices; and efforts to open and modernize the economy remain uneven.

purchasing power parity - $295.3 billion (2002 est.)

4.4% (FY01/02 est.)

purchasing power parity - $2,000 (FY01/02 est.)

agriculture: 24%
industry: 25%
services: 51% (FY01/02 est.)

35% (2001 est.)

3.9% (2002 est.)

40.4 million
note: extensive export of labor, mostly to the Middle East, and use of child labor (2000)

agriculture 44%, industry 17%, services 39% (1999 est.)

7.8% plus substantial underemployment (2002 est.)

textiles, and apparel, food processing, beverages, construction materials, paper products, fertilizer, shrimp

2.4% (FY01/02 est.)