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Islamic Republic of Pakistan اسلامی جمہوریۂ پاکستان Islāmī Jamhūriya-i-Pākistān
Flag Coat of arms of Pakistan Coat of arms
Motto: Yaqeen-e-muhkam, ittihād, nazm (Urdu: Faith (self confidence), Unity, Discipline)
Anthem: Pak sarzamin shad bad (Blessed Be The Sacred Land)

Capital	Islamabad
Largest city	Karachi (also financial capital)
Official languages	Urdu, English
Government	Federal republic
Independence
• Water (%)	3.1
Population
• 2005 estimate	162,419,946 (6th)
GDP (PPP)	2004 estimate
• Total	$360.8 billion (26th)
• Per capita	$2567 (135th)
HDI (2003)	0.527 low (135th)
Currency	Rupee (Rs.) (PKR)
Time zone	UTC+5:00 (PST)
• Summer (DST)	UTC+5:00 (not observed)
Calling code	92
ISO 3166 code	PK
Internet TLD	.pk

The Islamic Republic of Pakistan (Urdu: اسلامی جمہوریۂ پاکستان, islāmī jamhūriya i pākistān), or Pakistan (Urdu: پاکستان, pākistān) is a country located in South Asia that overlaps onto the Greater Middle East and Central Asia. The country borders India, Afghanistan, Iran (Persia), China and the Arabian Sea. The name of the country "Pakistan" in Urdu and Persian means Land of the Pure. With around 163 million inhabitants, it is the sixth most populous country with the second largest Muslim population. It is a member of the UN, Commonwealth of Nations, SAARC and the OIC.

History

See main article for detailed information: History of Pakistan (Including pre-history, civilizations of the region, and modern events to date)

File:Mohan-jo-daro.jpg

Ruins of Mohen-jo-Daro, 80 km southwest of Sukkur, was center of Indus Valley Civilization, 2600 BCE – 1800 BCE

Pakistan is the birthplace of some of the most ancient civilizations and a strategic center of historic trade routes, including the Silk Road. It exists in a region whose history has overlapped that of many empires (e.g Mughals) and also of countries including India, Afghanistan and Persia (Iran). As one of the cradles of human civilization, the Pakistani region has long been at the crossroads of history. Pakistan was the site of the Indus Valley civilization and was subsequently conquered by many groups, including Aryans, Persians, Greeks, Greco-Bactrians, Kushans, White Huns, and Scythians. This period saw the country advance in trade and culture to a level where the Gandhara region and the great city of Taxila (Takshashila) became a great center of learning and development.

Ancient History

Nearly all of ancient Pakistan was ruled by the Persian Achaemenid dynasty for over two hundred years beginning in 540 BCE. In 326 BCE, Alexander the Great defeated the Punjabi king Porus (Paurava) at the Hydaspes near Jhelum. After Alexander's death and brief Seleucid control, Chandragupta Maurya gained control of the territory. His grandson Ashoka is known as to have been one of the major proselytizers of Buddhism which spread in the region. After the last ruler of the Mauryan dynasty was overthrown in 185 BCE,

Demetrius of Bactria conquered Gandhara and Punjab in 184 BCE, establishing an Indo-Greek kingdom that lasted nearly two centuries, until around 10 BCE. To the south, this kingdom captured Sindh and extended to the coast of the Arabian Sea. One of the prominent Greco-Bactrian kings was Menander, who ruled from 155 to 130 BCE and is believed to have been a convert to Buddhism. His territories covered the eastern dominions of the divided Greek empire of Bactria (from the areas of the Panjshir and Kapisa, now in Afghanistan) and extended to the Pakistani province of Punjab with diffuse tributaries to the south and east, possibly even as far as Mathura in modern India. Sagala (modern Sialkot) became his capital and propered greatly under Menander's rule. The last Greek king to rule independently was probably Strato II, whose reign ended about 10 CE. Various Greek kings ruled into the beginning of the 1st century CE, as petty rulers (such as Theodamas) and as administrators, after the area was conquered by various Central Asian groups, most notably the Tocharian Kushans.

The Kushan kingdom stretched from modern-day Uzbekistan to northwestern India. The kingdom was founded by King Heraios, and greatly expanded by his successor, Kujula Kadphises. Kadphises' son Vima Takto conquered territory now in India, but lost much of the western parts of the kingdom, including Gandhara, to the Parthian king Gondophares.

Later invaders included the Scythians, and White Huns. While the Punjab remained under the Huns and Scythians, the Sassanian Persian Empire then came to control most of western Pakistan and parts of Sind came under the rule of Hindu rajas.

Arrival of Islam

In the eighth century CE, the arrival of the Arab Muslims to the provinces of Sindh and Punjab set the stage for the geographic boundaries of the modern state of Pakistan and formed the foundation for Islamic rule which quickly spread across much of South Asia. Following the rule of various Islamic empires, including the Ghaznavid Empire, the Ghorid kingdom, and the Delhi Sultanate, the region was controlled by the Mughals from 1526 until 1739. From 1739 until the early 19th century the entire area was ruled briefly by Nadir Shah and then by the Afghans and then later the Baluchis and Sikhs came to control Sind and the Punjab.

British rule

To the east, the British had arrived and formed the British East India Company which would eventually spearhead a colonial dominion over South Asia. The Mughal Empire was then at a decline and the eventual collapse of the anti-British struggle by the Muslim leader Tipu Sultan from 1749 to 1799 left the remnants of the Mughal Empire vulnerable. The British did not gain strong footholds in the Pakistani region until the early 19th century and annexed the entire area during the Great Game rivalry with the Russian empire.

The Indian War of Independence in 1857 was the last South Asian armed struggle against the British, while the Anglo-Afghan wars continued into the 20th century. After crushing the struggle the British dubbed the event the "Sepoy Mutiny". Even though the War of Independence was a joint Muslim-Hindu struggle to oust the British, the brunt of British retaliation was directed at the Muslim population of the empire employing the infamous "Divide and rule" policy. This suppression and subjugation helped set the stage for the creation of Pakistan - an Islamic state for the Muslims of British India. The greatest proponent of this became Muhammad Ali Jinnah, who later earned the title of Quaid-e-Azam (Urdu: قائد اعظم) meaning "great leader" and founder of Pakistan.

Independence and After Independence

After a 60 year formal and generally unarmed struggle for independence, Pakistan came into existence on 14th August 1947 from the British Empire. The British divided up the Indian empire into three parts: the central part, with a Hindu majority, became modern-day India, the western part along with parts of the Punjab became West Pakistan, while East Bengal (the Muslim majority part of Bengal) became East Pakistan. The Partition of India is believed by many to have been mishandled by the British since it resulted in the worst ever recorded communal riots in the region and perhaps one of the worst in modern history. An estimated 1 to 5 million Muslims, Sikhs, Hindus and others in former British India lost their lives as a direct consequence and millions more became refugee migrants to the newly formed Islamic Republic of Pakistan.

Due to a hasty British retreat and mishandling of the independence of its former colonies, various disputes would remain between India and Pakistan involving Kashmir and the Rann of Kutch (Sir Creek) regions. Both nations have fought three all out wars due to these unsettled issues. Other inherited legacies of British rule included the Durand Line debate regarding the border with Afghanistan.

In 1971, economic and political discontent in East Pakistan – geographically separated from West Pakistan by India – and violent political repression escalated into a civil war (see Bangladesh Liberation War) in East Pakistan and the Indo-Pakistani War of 1971, resulting in the secession of East Pakistan, which formed the independent state of Bangladesh.

The Soviet invasion of Afghanistan in 1979 created a large influx of refugees fleeing to Pakistan from Afghanistan; the largest in the world. In one of the largest covert operations in history, Pakistan and the United States supported anti-Soviet freedom fighters in Afghanistan, and the Soviets withdrew in the late 1980s.

Politically since its formation, Pakistan has oscillated between democratic and military rule, while making some impressive recent economic strides.

Origin of the name

The name was coined by Cambridge student and Muslim nationalist Choudhary Rahmat Ali. He devised the word and first published it on January 28, 1933 in the pamphlet Now or Never . He saw it as an acronym formed from the names of the "homelands" of Muslims in South Asia. (P for Punjab, A for the Afghan areas of the region, K for Kashmir, S for Sindh and tan for Baluchistan, thus forming 'Pakstan.' An 'i' was later added to the English rendition of the name to ease pronunciation, producing Pakistan.) The word also captured in the Persian language the concepts of "Pak" meaning "Pure" and "stan" for "land" or "home" (as in the names of Central Asian countries in the region; Afghanistan, Turkmenistan, etc), thus giving it the meaning Land of the Pure.

All Arabic-speaking countries refer to Pakistan as باکستان (Bakstaan), as the Arabic alphabet lacks the letter "P."

Politics

Domestic Politics

Main article: Politics of Pakistan

Form of Government

Constitutionally a federal republic, with considerable autonomy to the four Provinces – Sindh, Balochistan, Punjab, and NWFP (Sarhad) and the state of Azad Kashmir (Azad meaning Free in Urdu).

The upper house is called the Senate, which has 100 seats equally distributed among the four provinces of Pakistan, with reserved seats for women and religious minorities, who may also contest the general seats.

The lower house is called the National Assembly of Pakistan and has 342 seats including reserved seats for religious and ethnic minorities and women.

National Assembly elections were held in October 2002, and Senate elections in February 2003. One notable outcome was the election of 91 women to Parliament – the largest number (and the largest percentage) of women in the parliament of any Muslim-majority country, according to data from the Inter-Parliamentary Union.

Members of the National Assembly are elected for five-year terms. The National Assembly elects the Prime Minister of Pakistan, who then appoints selected members of the National Assembly and Senate as federal ministers in the cabinet.

The Electoral College of Pakistan – consisting of the Senate, National Assembly, and the provincial assemblies – elects the President of Pakistan, who is the Head of State and Commander in Chief of the Armed Forces. The President’s appointment and term are constitutionally independent of the Prime Minister’s term.

Each province has a Provincial Assembly which is elected for five year terms through competitive multi-party elections, and which in turn elects a Chief Minister – the executive head of the province. Provinces also have governors who are appointed by the Federal Government.

Political Parties

Before and during the creation of Pakistan in 1947, the secular and centrist Pakistan Muslim league supported the creation of Pakistan while the far-right religious parties such as the Shia Conference , Jamiat-e-Ulema-e-Hind and leaders such as Maulana Azad opposed the creation of Pakistan and supported a united India. The liberal, leftist Pakistan Peoples Party (PPP) emerged as a major political player during the 1970s. During 80s, a new political anti-feudal movement started by unorthodox and educated urban dwellers of Sindh, specially Karachi, now known as MQM.

Currently, the largest party in Parliament is the Pakistan Muslim League (Q) (PML-Q) and the second largest is the Pakistan Peoples Party Parliamentarians (PPPP). The PML-Q obtained a plurality in the October 2002 elections. Besides these major players, there are several other political parties active in Pakistan.

Foreign Relations

Main article: Foreign relations of Pakistan

File:PM Lodges.jpg

Prime Minister Residence Islamabad.

Pakistan was an ally of the United States for much of its early history as a modern nation-state, from the 1950s and as a member of CENTO and SEATO. However, it all changed from 1965 when Pakistan went to war with India during the height of the Cold War. The US placed heavy military sanctions on Pakistan during the war forcing Pakistan to agree to the cease fire and pulling out of the war that was heading for a stalemate.

After the 1965 war Pakistan had moved away from the US and its relations with China became stronger and soon both nations declared their alliance. Their relations have gone so far that it concerns the Western Super Powers. Despite US opposition, Pakistan dropped out of CENTO and SEATO for the PRC and supported their induction as a permanent member of United Nations Security Council.

United States maintained a lukewarm relationship until the 1970s. In 1971, Pakistan was involved in a civil war which led the breaking away of East Pakistan, now Bangladesh. China supported Pakistan and did not accept the new nation of Bangladesh for over 3 years, even though in 1973 Pakistan itself had. The US also did not accept Bangladesh in favor of Pakistan until after the Shimla Accord.

The Soviet involvement in the war and the Chinese influence on Pakistan prompted USA to bolster ties with a lost ally and the alliance would not be strengthened until the Afghan war. In the 1980s Pakistan was supplied by the US with necessary arms and helped in training supporting anti-Soviet militia in Afghanistan. US promised to provide Pakistan with F-16 fighter jets though only a few were eventually supplied due to the Pressler amendment. China however chose to remain out of this alliance, instead providing moral support.

After the Afghan war, which ended in favor of the anti-Soviet Alliance, the relationship with the US deteriorated when sanctions were imposed on Pakistan along with India for their nuclear program. All military equipment aid was again barred. China came to Pakistan's aid and helped them establish ground force and aviation infrastructures.

Prior to the US-Led coalition war in Afghanistan, China remained the main exporter and trader with Pakistan. After September 11th, 2001, and the subsequent American-led assault on Afghanistan, current Pakistani president Pervez Musharraf aligned his government again with the US and attempted to seal borders with Afghanistan and silence Islamic radicals along it (especially in the NWFP and other rural, fronteir provinces). Since this strategic re-alignment towards US policy, the economic and military aid has been flowing from the US to Pakistan in large numbers.

Besides the US and China, Pakistan enjoys alliances with some Middle Eastern countries like Saudi Arabia and the United Arab Emirates. PAF pilots fly fighters for these two countries. Libya and Syria are the only two middle eastern countries with whom Pakistan enjoys great relations even though they were once Soviet allies.

Pakistan is also an important member of the OIC, which brings it closer to every Muslim country. Besides OIC, Pakistan is a member of the South Asian union of SAARC.

Pakistan is the second largest Muslim country in terms of population and its status as a declared nuclear power—the only Islamic nation—also plays into its role on the international scene.

Political History

Pakistan has been ruled by both democratic and military governments. General Ayub Khan was the president from 1958 to 1969, and General Yahya Khan from 1969 to 1971. Civilian rule continued from 1971 to 1977 under Zulfikar Ali Bhutto, but he was deposed by General Zia-Ul-Haq. General Zia was killed in a plane crash in 1988, after which Benazir Bhutto, daughter of Zulfikar Ali Bhutto, was elected as the Prime Minister of Pakistan. She was the youngest woman to ever be elected the Head of Government and the first woman to be elected as the Head of Government of a Muslim country. Her government was followed by that of Nawaz Sharif, and the two leaders alternated until the military coup by General Pervez Musharraf in 1999. Since the resignation of President Rafiq Tarar in 2001, Musharraf has been the President of Pakistan.

Pakistan's first decade was marred with political unrest and instability resulting in frequent collapses of civilian democratic governments. From 1947 to 1958 as many as seven Prime Ministers of Pakistan either resigned or were ousted. This political instability paved the way for Pakistan’s first military take over. On October 7th 1958 Pakistan’s civilian and first President Iskander Mirza in collaboration with General Mohammad Ayub Khan abrogated Pakistan’s constitution and declared Martial Law.

Nation-wide parliamentary elections were held in October 2002, with the PML-Q winning a plurality of seats in the National Assembly of Pakistan, and Zafarullah Khan Jamali of that party emerging as Prime Minister. Jamali resigned on June 26, 2004. PML-Q leader Chaudhry Shujaat Hussain became interim PM, and was succeeded by Finance Minister and former Citibank Vice President Shaukat Aziz, who was elected Prime Minister on August 27, 2004 by a National Assembly vote of 191 to 151.

Geography

Main article: Geography of Pakistan

Pakistan has a total area of 803,940 square kilometers, over three times the size of the United Kingdom. It has a land area of 778,720, slightly less than the combined land areas of France and the United Kingdom put together.

To the south is the Arabian Sea, with 1,046 km (650 mile) of Pakistani coastline. To Pakistan's east is India, which has a 2,912 km (1,809 mile) border with Pakistan. To its west is Iran, which has a 909 km (565 mile) border with Pakistan. To Pakistan's northwest lies Afghanistan, with a shared border of 2,430 km (1,510 miles.) China is towards the northeast and has a 523 km (325 mile) border with Pakistan.

The northern and western areas of Pakistan are mountainous. Pakistani administered areas of Kashmir contain some of the highest mountains in the world, including the second tallest — K2 — and has areas of preserved moist temperate forest.

File:Lake Saif-Ul-Maluk - Naran, Pa by makhna.jpg

Lake Saif-ul-Muluk in northern Kaghan Valley

In the southeast, Pakistan's border with India passes through a flat desert, called the Cholistan or Thar Desert. West-central Balochistan has a high desert plateau, bordered by low mountain ranges. Most areas of the Punjab, and parts of Sindh, are fertile plains where agriculture is of great importance.

Pakistan is also the home of some of the world's most ancient civilizations. Places like Mohenjodaro, Harappa, Kot Diji, Thatta, Bhambore, Gandhara, Mehrgarh, Dir are all sites that came into existance near the dawn of civilization several thousand years ago.

Economy

Main article: Economy of Pakistan

Overview

Pakistan, a developing country, is the sixth most populous in the world and has faced a number of challenges on the political and economic fronts. Although a very poor country when it became independent in 1947, in the 1960s Harvard economists proclaimed it to be a model of economic development. In each of its first four decades, Pakistan's economic growth rate was better than the global average, but imprudent policies led to a slowdown in the late 1990s. Since then, the Pakistani government has instituted wide-ranging reforms, and economic growth has accelerated in the current century. Pakistan's economic outlook has brightened and its manufacturing and financial services sectors have experienced rapid expansion. The growth of the non-agricultural sectors has changed the structure of the economy, and agriculture now only accounts for roughly one-fifth of the GDP. There has been a great improvement in its foreign exchange position and a rapid growth in hard currency reserves in recent years.

In 2004 Pakistan's GDP growth rate was 8.4% which is (after China) the second-highest among the ten most populous countries in the world.

Macroeconomic Reform and Prospects

According to many sources, the Pakistani government has made substantial economic reforms since 2000, and medium-term prospects for job creation and poverty reduction are the best in nearly a decade.

Government revenues have greatly improved in recent years, as a result of economic growth, tax reforms - with a broadening of the tax base, and more efficient tax collection as a result of self-assessment schemes and corruption controls in the Central Board of Revenue - and the privatisation of public utilities and telecomunications. Pakistan is aggressively cutting tariffs and assisting exports by improving ports, roads, electricity supplies and irrigation projects. Islamabad has raised development spending from about 2% of GDP in the 1990s to 4% in 2003, a necessary step towards reversing the broad underdevelopment of its social sector.

Liberalisation in the international textile trade has already yielded benefits for Pakistan's exports, and the country also expects to profit from freer trade in agriculture. As a large country, Pakistan hopes to take advantage of significant economies of scale, and to replace China as the largest textile manufacturer as the latter China moves up the value-added chain. These industries play to Pakistan's relative strengths in low labour costs.

A perception of stability in the nation's monetary policies has contributed to a reduction in money-market interest rates, and a great expansion in the quantity of credit, changing consumption and investment patterns in the nation. Pakistan's domestic natural gas production, and its significant use of CNG in automobiles, has cushioned the effect of the oil-price shock of 2004-2005. Pakistan is also moving away from the doctrine of import substitution which some developing countries (such as Iran and India) dogmatically pursued in the twentieth century. The Pakistani government is now pursuing a export-driven model of economic growth successfully implemented by South East Asia and now highly successful in China.

In 2005, the World Bank reported that

"Pakistan was the top reformer in the region and the number 10 reformer globally — making it easier to start a business, reducing the cost to register property, increasing penalties for violating corporate governance rules, and replacing a requirement to license every shipment with two-year duration licenses for traders."

In addition, reduced tensions with India and the ongoing peace process raise new hopes for a prosperous and stable South Asia, with more intra-regional trade.

Growing Middle Class

Measured by purchasing power, Pakistan has a 30 million strong middle class enjoying per capita incomes more than $8000-$10,000, according to Dr. Ishrat Husain, Governor of the State Bank of Pakistan . In addition, Pakistan has a growing upper class with relatively high per capita incomes. However, Pakistan has no individuals with as much as a billion US dollars, according to Forbes magazine, and has the distinction of being the most populous nation to have no billionaires.

Economic History

First Five Decades

Economically, Pakistan was a very poor and predominantly agricultural country at the time of its independence in 1947 from British India. During its first four decades, Pakistan's economic growth rate was better than the global average. Industrial-sector growth, including manufacturing, was also above average. In the early 1960s, Pakistan was seen as a model of economic development 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 its Second Five Year Plan, 1960-65. Not just that But World financial center in Seoul was 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.

Economic Resilience

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 period —

the Asian financial crisis;
economic sanctions — according to Colin Powell, Pakistan was "sanctioned to the eyeballs";
global recession;
a severe drought — the worst in Pakistan's history, lasting four years;
heightened perceptions of risk as a result of military tensions with India — with as many as a million troops on the border, and predictions of impending (potentially nuclear) war; and
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.

Recent economic history and trends

Sectoral contribution to GDP Growth (in % point)
Sector	2001-02	2002-03	2003-04	2004-05
Agriculture	0.03	1.01	0.53	1.74
Industry -Manufacturing	0.61 1.71	1.08 1.11	2.74 2.31	2.46 2.19
Service	2.47	2.75	3.16	4.16
Real GDP (fc)	3.1 %	4.8 %	6.4 %	8.4 %
Source: Economic Survey of Pakistan 2005

Since about the turn of the century, the Pakistani government has instituted wide-ranging reforms, and economic growth has accelerated in the current century. Pakistan's economic outlook has brightened and its manufacturing and financial services sectors have experienced rapid expansion. The growth of the non-agricultural sectors has changed the structure of the economy, and agriculture now only accounts for roughly one-fifth of the GDP. There has been a great improvement in its foreign exchange position and a rapid growth in hard currency reserves as a result of its current account surplus.

In the fiscal year ending June 30, 2005, Pakistan's GDP growth rate was 8.4% which is (after China) the second-highest among the ten most populous countries in the world. Its exports grew by as much as 17% and the country also saw increasing foreign investments in the IT sector, thanks to cheap labor, a low tax rate and a large pool of English speakers.

Structure of production

Sectoral Share of Various Sectors in GDP
Sector	2000-01	2001-02	2002-03	2003-04	2004-05
A) Commodity Sector (1+2+3+4+5)	48.2	47.3	47.1	47.4	47.6
1. Agriculture	25.1	24.4	24.2	23.3	23.1
2. Mining	1.3	1.4	1.5	1.5	1.4
3. Manufacturing	15.9	16.1	16.4	17.6	18.3
4. Construction	2.4	2.4	2.4	2.1	2.0
5. Energy Distribution	3.4	3.0	2.5	2.9	2.7
B) Services Sector (6+7+8+9+10+11)	51.8	52.7	52.9	52.6	52.4
6. Transportation & Comm.	11.7	11.5	11.5	11.4	11.1
7. Trade	18.1	18.0	18.2	18.5	19.1
8. Finance & Insurance	3.1	3.6	3.3	3.3	3.7
9. Ownership of Dwellings	3.2	3.2	3.2	3.1	2.9
10. Public Admin. & Defence	6.3	6.5	6.7	6.5	6.0
11. Other Services	9.4	9.9	10.0	9.9	9.6
Note: GDP at constant factor cost. Figures are in percentage. Source: Economic Survey of Pakistan 2005

Stock Market

In the first three years of the current century, Pakistan's KSE-100 stock market index (Karachi Stock Exchange) was the best-performing major market index in the world, driven in part by profit growth, high dividend yields and greater transparency in publicly traded companies as a result of reforms enacted by the Securities and Exchange Commission of Pakistan.

Currency

File:Pakistan 1000 Rupees b.jpg

Rupee, the basic unit of currency of Pakistan.

The basic unit of currency is the Rupee, which is divided into 100 paisas. Since the turn of the century, a strengthening economy and large current-account surplus has caused the rupee's exchange rate to rise in value. In response, Pakistan's central bank has prevented the rupee from rising too much, by lowering interest rates and buying dollars, in order to preserve the country's export competitiveness. As of 2005, one US dollar is approximately equal to 60 rupees.

Industry

Manufacturing and Finance

Pakistan's manufacturing sector has experienced double-digit growth in recent years, with large-scale manufacturing growing by 18% in 2003. A reduction in the fiscal deficit has resulted in less government borrowing in the domestic money market, lower interest rates, and an expansion in private sector lending to businesses and consumers. Foreign exchange reserves continued to reach new levels in 2003, supported by robust export growth and steady worker remittances.

Tax Incentives & IT Industry

The Government of Pakistan has, over the last few years, granted numerous incentives to technology companies wishing to do business in Pakistan. A combination of decade-plus tax holidays, zero duties on computer imports, government incentives for venture capital and a variety of programs for subsidizing technical education, are intended to give impetus to the nascent Information Technology industry. This in recent years has resulted in impressive growth in that sector. Pakistan saw an increase in IT exports of 50% from 2003-4 to 2004-5, with total exports standing at $48.5 million. This year the government has set an export goal of $72 million. Exports account for 11% of the total revenues of the IT sector in Pakistan. Compared to its neighbor, India, Pakistan's IT sector is still in the infantile stage, but recent trends have led economists to be optimistic about the IT industries future prospects in Pakistan.

Technology & Internet

Paging and mobile (cellular) telephony were adopted early and freely. Cellular phones and the Internet were adopted through a rather laissez-faire policy with a proliferation of private service providers that led to fast adoption. Both have taken off and in the last few years of the 1990s and first few years of the 2000s. With a rapid increase in the number of internet users and ISPs, and a large English-speaking population, Pakistani society has seen major changes.

Pakistan has more than 20 million Internet users as of 2005. 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.

Almost all of the main government departments, organizations and institutions have their own websites.

The use of search engines and instant messaging services is also booming. Pakistanis are some of the most ardent chatters on the Internet, communicating with users all over the world. Recent years have seen a huge increase in the use of online marriage services, for example, leading to a major re-alignment of the tradition of arranged marriages.

As of 2005 there were 6 cell phone companies operating in the country with nearly 28 million mobile phone users in the country.

Wireless local loop and the landline telephony sector has also been liberalized and private sector has entered thus increasing the teledensity from less than 3% to more than 10% in span of two years.

Agriculture, Energy and Natural Resources

File:Hunza by jayzee.jpg

The Valley of Hunza in Pakistan. — Agricultural and scenic

Pakistan's principal natural resources are arable land, water, and extensive natural gas and petroleum reserves.

Agriculture

About 28% of Pakistan's total land area is under cultivation and is watered by the largest irrigation systems in the world. Water resources include several major rivers, fed by meltwater from snow and glaciers in some of the highest mountains ranges of the world — the Karakorams, Himalayas, and the Hindukush. Other important sources are tube-wells tapping into large aquifers. The most important crops are cotton, wheat, and rice. Other important crops are sugarcane, maize, sorghum, millets, pulses, oil seeds, barley, fish, fruits and vegetables. Pakistan also produces some of the world's best honey. Pakistan is a net exporter of foodgrains.

Energy

Pakistan has extensive energy resources, including fairly sizable natural gas reserves, oil reserves and coal. It also has a large potential for the further development of hydroelectric power. Domestic petroleum production totals only about half the country's oil needs. Pakistan is operating, constructing or planning to construct several nuclear reactors to meet its rapidly growing electricity requirements.

Minerals

Important minerals found in Pakistan are gypsum, limestone, chromites, iron ore, rock salt, silver, gold, precious stones, gems, marble, copper, coal, graphite, sulphur, fire clay, silica. The salt range in Punjab Province has large deposits of pure salt. Balochistan province is a mineral rich area having sub-stantial mineral, oil and gas reserves which have not been exploited to their full capacity. The province has significant quantities of copper, chromite and iron, and pockets of antimony and zinc in the south and gold in the far west. Natural gas was discovered near Sui in 1952, and the province has been gradually developing its oil and gas projects over the past fifty years.

Trade

Exports

Pakistan exports software, rice, furniture, cotton fiber, cement, tiles, marble, textiles, clothing, leather goods, sports goods (renowned for footballs/soccer balls), surgical instruments, electrical appliances, carpets, and rugs, ice cream, livestock meat, chicken, powdered milk, wheat, seafood (especially shrimp/prawns), vegetables, processed food items, Pakistani assembled Suzukis (to Afghanistan and maybe other countries), defence equipment (submarines, tanks, radars), salt, marble, onyx, engineering goods, fighter planes, and many other items.

Imports

Pakistan's single largest import category is petroleum and petroleum products. Other imports include trucks, automobiles, and industrial machinery. Pakistan also imports computers, computer parts, construction machinery, medicines, pharmaceutical products, food items, airplanes, defence equipment, steel, toys, electronics, other consumer items.

Tourism

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Pakistan's culture, people and landscape are very diverse. Therefore tourism has, in recent years, become a large industry in Pakistan. What is now Pakistan has in the past been invaded and occupied by many different peoples, including Huns, Persians, Arabs, Turks, Mongols and various Eurasian groups, all of which left differences in culture among the different ethnic groups in matters such as dress, food, and religion, especially where indigenous pre-Islamic customs differ from Islamic practices. It is home to a large ancient civilization rivalling those of Egypt and Mesopotamia and also of many smaller civilizations which settled there.

There are many tourist attractions in Pakistan. In the North, some of the highest mountains in the world, interest mountain climbers and adventurers from around the world. The Northern Areas of Pakistan are one of the most scenic places to be found with many old army fortresses, towers and other architecture. Among the most beautiful valleys in this area are Chitral and Hunza. The inhabitants of the region are known for their tradition of hospitality, offering food and residence for tourists.

In the east, the Punjab province offers a view into the many different civilizations that settled there. Islamic Mughal architecture is very common, such as Badshahi Masjid andthe Shalimar Gardens in Lahore. Pakistan's film industry, Lollywood is also present here.

Demographics

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Major ethnic groups in Pakistan and surrounding areas, 1980

Main article: Demographics of Pakistan

Population Statistics

Pakistan has the world's sixth largest population, more than Russia, but less than Brazil. Because of Pakistan's high growth rate, it is expected to overtake Brazil in population before 2025. Based on the high fertility rates of the 1980s, demographers had projected that Pakistan would be the third most populous nation by 2050. However, from 1988 onward, Pakistan's fertility rate has fallen faster than that of any other country except China (Feeney and Alam, 2003, PDF). It is now projected that its population will stabilize to a more sustainable level.

Religion

The majority of the people of Pakistan are Muslim (adherents of Islam). Most (75%) are Sunni, some (20%) are Shia.

Pakistan has a small non-Muslim population whose numbers remain somewhat difficult to ascertain due to various social conditions within Pakistan, including the inability of the census to account for every person and some alleged discrimination and hesitancy by some to accurately report their professed faith. According to most sources Pakistan's religius minorities consist largely of Christians (2.5%) or 3.9 million, while the remaining 1.2% includes Hindus, Buddhists, Zoroastrians, Sikhs, Jews, and Animists (mainly the Kalash in Chitral). Pakistan's religious demographics were influenced by the partition of British India, which led to the fleeing of 7 million Muslims into Pakistan from India and 6 million Hindus and Sikhs from Pakistan to India and led to a larger Muslim majority than had previously existed.

Pakistan is also the birthplace of one major world religions, Sikhism and two branches of Buddhism Mahayana Buddhism and Vajrayana Buddhism. Although today there are few Sikhs in Pakistan, Pakistani Punjab was the birthplace of Guru Nanak, the founder of Sikhism as well the Sikh conqueror Ranjit Singh. In addition, Pakistan is also the birthplace of Mahayana Buddhism, the form of Buddhism practiced by most Buddhists today, including those in China, India, Japan, Vietnam, and Korea. It is also the birthplace of Vajrayana (Tantric) Buddhism. Also, the early formation of the Hindu religion may have taken place here, either amongst the Indus Valley Civilization or in the wake of the Indo-Aryan migration into the area and with the composition of the earliest of the sacred scriptures, the Rig Veda, but most academics believe Hinduism probably formed along the Ganges River further east instead.

Languages

Urdu and English are both recognized as the official languages of Pakistan. English is used in government and corporate business and by the educated urban elite. Private as well as public universities use English as the medium of instruction for degree courses. Urdu is the lingua franca of the people, being widely spoken as a second language, although it is the mother tongue of only 8% of the population, mainly Muhajirs (Muslim refugees from India after 1947) and Punjabis of urban areas. Besides these, nearly all Pakistanis speak mutually related provincial Indo-European languages, of which the most widely spoken is Punjabi, followed by Pashto, Sindhi, and Balochi. Other Indo-European languages spoken in Pakistan include Seraiki, Dari, Hindko, Potohari, Gujarati, Shina, Wakhi, Kashmiri, Khowar and many others. In addition, small groups of non-Indo-European languages are also spoken including Brahui which is a Dravidian language and Burushaski which is a language isolate.

Ethnic Groups

Punjabis comprise the largest ethnic group in the country. Other important ethnic groups include: Pashtun/Afghans, Sindhis, Balochis, Muhajirs and Seraikis. The numerous other ethnic groups are mainly found in the northern parts of the country such as Turwalis, Kafiristanis, Hindko, Brahui, Kashmiris, Khowar, Shina and so forth. There are also sizeable numbers of refugees from neighboring Afghanistan, who are found mainly in the NWFP and Baluchistan - in the 1980s, Pakistan accommodated over three million Afghan refugees - the largest refugee population in the world, which includes Pashtuns, Tajiks, and Hazaras among others. A sizeable number of Bengali immigrants are mainly concentrated in Karachi, while hundreds of thousands of refugees from Iran are scattered throughout the country. People of Sephardic Jewish descent are also found in the country, but probably number less than 200 since the creation of Israel. There is also a sizeable community of Persians, Chinese, Myanmarians (Burmese), and Africans; there are additional minorities of Arab, Mongolian, British, and Greek descent.

Subdivisions

Main article: Subdivisions of Pakistan, Districts of Pakistan.

Pakistan has 4 provinces, 2 territories, and also administers parts of Kashmir. The provinces are further subdivided into a total of 105 districts.

Provinces:

Territories:

Islamabad Capital Territory
Federally Administered Tribal Areas
Two provinces, NWFP and Balochistan, also have PATA (Provincially Administered Tribal Areas.) It is expected that these will be developed into regular districts.

Pakistani-administered portions of Kashmir:

Azad Kashmir (Azad means "free" or "independent" in Urdu)
Northern Areas

Society and Culture

Main article: Culture of Pakistan

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Baltit Fort in Hunza

Pakistan has a rich and unique culture, and has actively preserved its established traditions throughout history. Prior to the Islamic invasion, many Punjabis and Sindhis were Hindu and Buddhist. This later changed during the expansion of Islam through Pakistan by the Ummayad general Muhammad bin Qasim and later by Mahmud of Ghazni and others. Many cultural practices, foods and monuments, shrines, have been inherited from the rule of Muslim Mughal and Afghan emperors in all of Southern Asia. The Pakistani national dress, Shalwar Kameez is one of the clothing styles inherited from these rich cultural roots. Women wear brightly coloured shalwar Kameez with embroidery for special ocassions such as weddings while men often wear the sherwani.

Pakistani society is largely multilingual and multicultural. Religious practices of various faiths are an integral part of everyday life in society. Education is highly regarded by members of every socio-economic stratum. Traditional family values are highly respected and considered sacred, although urban families have grown into a nuclear family system, owing to the socio-economic constraints imposed by the traditional joint family system. The past few decades have seen emergence of a middle class in cities such as Karachi, Lahore, Rawalpindi, Hyderabad, Faisalabad, Sukkur, Peshawar, Gujrat, Abbottabad, Multan, etc. The Northwestern part of Pakistan, bordering Afghanistan, is highly conservative and dominated by centuries-old regional tribal customs.

Roots

The modern nation of Pakistan has inherited a very rich cultural and traditional background going back to the Indus Valley Civilization, 2800 BC–1800 BC. The region that is now Pakistan has in the past been invaded and occupied by many different peoples, including Elamo-Dravidians, Aryans, Greeks, White Huns, Persians, Scythians, Arabs, Turks, Afghans, Mongols and various Eurasian groups. There are regional differences in culture among the different ethnic groups in matters such as dress, food. Traditional Sufi practices of Islam are very stong in Pakistani culture

Film, Television & Music

Traditionally, the government-owned Pakistan Television Corporation (PTV) has been the dominant media player in Pakistan. However the past decade has seen the emergence of several private TV channels (news , entertainment) such as the INDUS TV, MASHRIQ, HUM, GEO TV, ARY, AAJ channels etc. Traditionally the bulk of TV shows have been plays or soap operas---some of them critically acclaimed. Various American, European, and Asian TV channels and movies are available to a majority of the population via Cable TV. As of 2005 there are 31 Pakistani Television channels operating.

Pakistani music is rich and represented by a wide variety of forms. It ranges from traditional styles such as Qawwali and Ghazal gayaki to more modern forms that try to fuse traditional Pakistani music with western music. The Qawwali maestro, Nusrat Fateh Ali Khan, is internationally renowned for creating a form of music which synchronized Qawwali with western music. Pakistan has produced many renowned Ghazal singers such as Mehdi Hassan, Farida Khanum, Abida Parveen and Iqbal Bano. Popular forms of music also prevail, the most notable being Film music. In addition to this are the diverse traditions of folk music in all four provinces. The emergence of Afghan refugees in the frontier provinces has also rekindled Pashto & Persian music in Pakistan. Peshawar has become a hub of Afghan musicians, and a distribution center for Afghan Music abroad. Afghan singers have become famous throughout the Frontier and some have even married within the local population strengthening the ethnic kinship of the Pashtuns on both sides of the Durand line.

An indigenous movie industry exists in Pakistan known as Lollywood as it is based in Lahore, currently producing over 40 feature-length films a year. There was a time when Lollywood was churning out as many as 120 films a year and became the dominant movie producer of the subcontinent.

Globalization

Increasing globalization has increased the influence of "Western culture" in Pakistan. Pakistan ranks 46th in the world on the Kearney/FP Globalization index. Many Western restaurant chains have established themselves in Pakistan, and are found in the major cities.

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PTDC Motel at Malam Jabba Ski Resort, Swat, NWFP, Pakistan.

A large Pakistani diaspora exists in the West. Whereas Pakistanis in the United States, Canada and Australia tend to be professionals, the majority of them in the United Kingdom, Germany and the Scandinavian nations comes from a rural background and belongs to the working class. Pakistan has more expatriates than any other Muslim country, with a large number of expatriates living in the Middle East. Pakistani emigrants and their children influence Pakistan culturally and economically, keeping close ties with their roots by travelling to Pakistan and especially by returning or investing there.

Sports

The most popular sport in Pakistan is cricket. Pakistan has produced several of the best batsmen and bowlers in the world, including Imran Khan, Wasim Akram, Waqar Younis, Javed Miandad and Inzamam-ul-Haq. Almost every district and neighborhood in Pakistan has its cricket team and most people start playing from a young age. Pakistan has won some international cricket events, including the World Cup in 1992.

Other popular participatory and spectator sports in Pakistan include:

Field Hockey. Pakistan men's team has won three gold medals at the Olympics and lifted the Hockey World Cup four times. It has also won the most number number of Asian gold medals and is the only Asian team to have won the prestigious Champions Trophy. It has been consistently ranked amongst the top 5 teams in the world.
Polo, which is believed to have originated in Central Asia, and continues to be an important sport there with several large annual competitions. The Shandur Polo Tournament, played at the world's highest pologround, is one of the biggest tourist draws to Chitral and Gilgit in Northern Pakistan.
Squash. Jahangir Khan and Jansher Khan are considered to be two of the greatest squash players of all time. Pakistan has won the squash World Open 17 times, the highest by any nation.
Football (Soccer) is played mostly on a local level, primarily in Baluchistan and North West Frontier Provinces. Those areas provide most of the players on the national team.
Tennis. Aisam-ul-Haq Qureshi recently defeated Paradorn Srichapan of Thailand to win the Asia-Oceana Zone 1 section of the Davis Cup.
Formula One motor racing, NBA basketball, rugby, table tennis, chess, Kabaddi and badminton.

Mercantile Culture

Pakistan's service sector accounts for 53% of the country's GDP. Wholesale and retail trade is 30% of this sector. Shopping is a popular pastime for many Pakistanis, especially among the well-to-do and the thirty-million strong middle class. Karachi city is especially known for the great contrast in shopping experiences - from burgeoning bazaars to modern multi-story shopping malls.