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Old Wednesday, November 14, 2007
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Post Pak-Affairs Notes

Indo-Pakistani Wars


I -INTRODUCTION
Indo-Pakistani Wars, three wars fought between India and Pakistan since the two nations gained independence from Britain in 1947. The first and second wars (1947-1949; 1965) were fought over the territory of Jammu and Kashmīr, in the northwestern part of the Indian subcontinent. The status of the territory remains a matter of dispute between India and Pakistan. The third war (1971) involved Indian military intervention in a civil war in Pakistan. This brief and decisive intervention resulted in the independence of Pakistan’s eastern province, East Pakistan, as the nation of Bangladesh.

II -HISTORICAL BACKGROUND
The roots of Indo-Pakistani discord can be traced to the process of British colonial withdrawal from the Indian subcontinent. In 1947 the British government decided to partition the British Indian Empire into the independent states of India and Pakistan. This decision followed the failure of the two nationalist parties of British India, the Muslim League and the Indian National Congress, to resolve their differences in negotiations preceding independence. The Muslim League advocated the creation of a separate state called Pakistan to serve as the homeland for Muslims of South Asia. The Congress, on the other hand, officially supported building a single country based on secular (nonreligious) nationalism. That single country would have been predominantly Hindu, however, because Hindus greatly outnumbered Muslims in British India.

These two competing ideologies of state-building collided over the status of Jammu and Kashmīr, which had been one of 562 so-called princely states in the British Indian Empire. These states were nominally independent as long as they recognized the paramountcy (authority) of the British crown. Under this colonial doctrine, the maharajas (monarchs) of these states exercised all powers except those pertaining to defense, foreign affairs, and communications. With the end of colonial rule, the maharajas were informed by the last British viceroy to India, Lord Louis Mountbatten, that they had to choose between joining either India or Pakistan. Mountbatten ruled out the prospect of independence. Furthermore, he decreed that predominantly Muslim princely states that bordered Pakistan would become part of that nation.

Jammu and Kashmīr therefore posed an interesting conundrum. It had a predominantly Muslim population, a Hindu ruler, and its borders abutted both India and Pakistan. The Pakistani leadership laid claim to the princely state on grounds that fellow Muslims in a neighboring state had to be incorporated into Pakistan to ensure its completeness. India, on the other hand, was interested in incorporating the territory into the Indian Union to demonstrate that a predominantly Muslim state could thrive within the context of a secular India. However, the monarch of Jammu and Kashmīr, Maharaja Hari Singh, had hopes of maintaining his state’s independence and delayed accession to either India or Pakistan, even after British rule formally ended in mid-August 1947.

III -THE FIRST INDO-PAKISTANI WAR

A -Events Before the War
In October 1947 a rebellion broke out amid the Pashtun tribes in the western areas of Jammu and Kashmīr. The Muslim Pashtuns had long resented the Hindu maharaja’s rule, and in the wake of the British departure they moved to exploit the power vacuum and challenge the maharaja’s authority. Pakistani irregular forces, comprising members of the Pakistani army disguised as local tribesmen, entered the fray to support the Pashtun rebels. Within a week the rebels and their allies attacked and seized the border town of Muzzafarābād and then moved toward Srīnagar, the capital of Jammu and Kashmīr.
Hari Singh, now in a state of panic for fear Srīnagar would fall to the rebels, appealed to Indian prime minister Jawaharlal Nehru for military assistance. Nehru set two preconditions for the provision of assistance: first, the maharaja would have to accede Jammu and Kashmīr to India, and second, the accession would have to receive the approval of Sheikh Muhammad Abdullah, leader of the secular Jammu and Kashmīr National Conference, the largest political party in the state. In late October, satisfied these preconditions had been met, Nehru accepted the maharaja’s Instrument of Accession that gave India powers of defense, foreign affairs, and communications in Jammu and Kashmīr. Pakistan immediately disputed the validity of the maharaja’s accession, claiming he had signed under duress.

B -Major Events During the War
On October 27 Indian troops were airlifted into Srīnagar to stop the Pakistan-aided tribal advance. By this time the rebel forces, calling themselves Azad Kashmīr (Free Kashmīr), had captured a third of the state’s territory. Over the next several months the Indian army fought a number of pitched battles with the rebel forces. In the spring of 1948, Indian forces mounted a major offensive designed to regain much of the lost territory. This Indian offensive led to the direct involvement of the regular (uniformed) Pakistani army. The fighting escalated during the course of the year, but neither side made significant territorial gains.

On the advice of Mountbatten, Nehru had referred the dispute to the United Nations Security Council in January 1948. The council subsequently passed a series of resolutions seeking an end to the conflict. The resolutions called upon Pakistan to end its aggression in Jammu and Kashmīr and enjoined India to hold a plebiscite (vote) to determine the wishes of the Kashmīris on the final disposition of their state. Both sides eventually agreed to these terms, and the war ended on January 1, 1949, with the declaration of an UN-sponsored cease-fire. By then about 1,500 soldiers and rebels had died in battle.

C -Events After the War
Because the territorial dispute remained unresolved, Jammu and Kashmīr was partitioned along a line that reflected troop deployments at the time of the cease-fire. The de facto border was known as the Cease-Fire Line (CFL) until 1972, when it was renamed the Line of Control (LOC).

Since the partition, about one-third of the former princely state has been under Pakistani control. This area includes a small autonomous region—known by Pakistanis as Azad Kashmīr and by Indians as Pakistani-occupied Kashmīr—as well as a larger section directly administered by Pakistan, known as the Northern Areas. The remaining two-thirds of the historic region, including the southern province of Jammu, has been under Indian control. This area is administered as Jammu and Kashmīr State. (In historical references, the name of Jammu and Kashmīr, commonly shortened to Kashmīr, refers to the entire area of the former princely state.) In 1954 the legislative assembly of Jammu and Kashmīr State formally voted to join the state into the Indian Union. In India’s view, the vote ratified the maharaja’s 1947 accession and made the state an integral part of India.

After the war, the United Nations sought to reach an accord that would be acceptable to both parties and finally resolve the status of the disputed territory. However, these efforts proved futile as neither India nor Pakistan appeared willing to make significant concessions.

IV -THE SECOND INDO-PAKISTANI WAR
In 1965 India and Pakistan went to war over Jammu and Kashmīr a second time. Pakistan, dissatisfied with both multilateral and bilateral negotiations, again sought to wrest Jammu and Kashmīr from India through the use of force. This effort failed as India held its ground, and the war ended in a stalemate after almost two months of armed conflict. Although the second war over the territory was shorter than the first, the increased firepower of the two nations resulted in a more deadly war, with a total of about 6,800 battle casualties.

A -Events Before the War
A number of factors precipitated the second conflict over Jammu and Kashmīr. In the wake of a border war between India and China in 1962, efforts by the United States and Britain to settle the territorial dispute had, like the UN mediation process, met with little success. Furthermore, India significantly expanded its defense spending after suffering losses in the border war against China. At a regional level, India had started to integrate Jammu and Kashmīr State into the rest of the country, such as bringing it under the jurisdiction of the Indian Supreme Court. All of these factors—the failure of diplomatic efforts, the growth of India’s military, and India’s efforts at integration—provoked Pakistani misgivings about the erosion of its claim to Kashmīr.

When rioting broke out in Srīnagar in December 1963 following the theft of a holy relic from the Hazratbal mosque, the Pakistani leadership construed the anti-Indian tone of the disturbances as a sign of support for the merger of Kashmīr with Pakistan. Accordingly, Pakistani president Muhammad Ayub Khan and his foreign minister, Zulfikar Ali Bhutto, decided to try once again to wrest the territory from India.

B -Major Events During the War
Pakistani army personnel disguised as local Kashmīris began to infiltrate into the Kashmīr Valley in early August 1965. Once they entered the valley, the infiltrators intended to foment a rebellion among Kashmīri Muslims. The strategy, known as Operation Gibraltar, went awry from the very outset, however. The Kashmīris did not respond as expected; instead, they turned the infiltrators over to the local authorities. Accordingly, the Indian army moved to secure the border and on August 15 scored a major victory after a prolonged artillery barrage. Attacks and counterattacks followed in quick succession.

On September 1 the Pakistanis opened a new front in the southern sector, catching Indian forces unprepared. Indian forces responded with air strikes, leading to Pakistani retaliation. On September 5 the Pakistanis made a significant thrust into Indian territory that threatened to cut off Jammu and Kashmīr State from the rest of India. The following day Indian troops crossed the international border in the Pakistani province of Punjab near its capital of Lahore. Faced with this threat to Lahore, the Pakistanis launched a counterattack at Khem Karan in the neighboring Indian state of Punjab. This attack, spearheaded by the Pakistani First Armored Division, was anticipated by the Indian forces and failed, with Pakistani forces suffering major losses.

C -Events After the War
By mid-September the war had reached a stalemate, and the United Nations Security Council passed a resolution calling for a cease-fire. The Indian government accepted the cease-fire resolution on September 21, as did the Pakistani government the following day. The two parties subsequently attended Soviet-hosted peace talks in Toshkent (Tashkent), the capital of the Uzbek Soviet Socialist Republic (present-day Uzbekistan). On January 10 the two sides signed the Toshkent Agreement and reestablished the CFL as the de facto border in Jammu and Kashmīr.

V -THE THIRD INDO-PAKISTANI WAR
Unlike the first and second Indo-Pakistani wars, the third war, fought in 1971, did not involve the status of Kashmīr. Instead, it began as a Pakistani civil war in which East Pakistan, the eastern province of Pakistan, sought to secede from the country. This conflict escalated into a 14-day war between India and Pakistan after India’s military intervened to support the secession of East Pakistan. Although even shorter than the previous wars, the third war resulted in 11,500 battle deaths—the highest of all three conflicts. It also resulted in a truncated Pakistan, as East Pakistan became the sovereign nation of Bangladesh.

A -Events Before the War
The 1947 partition of the British Indian empire had created a Pakistan comprised of two “wings”—West Pakistan (present-day Pakistan) and East Bengal (later renamed East Pakistan; now Bangladesh)—that were separated by 1,600 km (1,000 mi) of Indian territory. In the wake of Pakistan’s first free and fair election in December 1970, the leaders of the western and eastern wings failed to reach an understanding about power sharing. In March 1971, after talks failed to break the deadlock, the Pakistani government launched a military crackdown in East Pakistan. During what was called Operation Searchlight, large numbers of the Bengali intelligentsia in East Pakistan were killed and many prominent Bengali leaders were thrown in jail. In response, the Awami League leadership of East Pakistan declared the province’s independence on March 26. As the crackdown escalated into a full-blown and brutal civil war over the next two months, some 10 million Bengalis fled East Pakistan and took refuge in the neighboring Indian state of West Bengal.
The Indian leadership of Prime Minister Indira Gandhi quickly decided that it was cheaper to resort to war against Pakistan than to absorb millions of refugees into India’s already bloated population. Highly antagonistic relations between India and Pakistan also contributed to India’s decision to intervene in Pakistan’s civil war. Gandhi and her advisers fashioned a strategy to support the creation of a separate state for ethnic Bengalis. This strategy involved support for the indigenous Bengali resistance movement, led by the Mukti Bahini (Liberation Force). To this end, India’s military intelligence agency, the Research and Analysis Wing, helped to organize, train, and arm these insurgents. The Mukti Bahini managed to harass the regular Pakistani army units stationed in East Pakistan and helped to create conducive conditions for a full-scale Indian military intervention in early December.

B -Major Events During the War
On December 3, 1971, the third Indo-Pakistani war formally began with a Pakistani air attack on a number of air bases in northwestern India. The Indian air force responded the next day by striking at several West Pakistani air bases. Along with the airborne attack, the Pakistani army simultaneously launched a ground operation in Kashmīr and in the Punjab region, thereby opening a western front. In the western sector a number of pitched battles took place, particularly in Azad Kashmīr near Pūnch (Poonch) and Chhamb. Other major engagements took place farther to the south in the Punjab region at Derā Nānak and Anūpgarh. Even farther south, an invading Pakistani tank column was bombed by the Indian air force, which carried out as many as 4,000 sorties during the conflict.

The use of air power was more limited in East Pakistan. The real thrust into the province was made by three Indian army divisions that launched a five-pronged attack on Dhaka, the provincial capital, and received the surrender of Pakistani forces there on December 16. The following day, India declared a unilateral cease-fire, and Pakistani leader General Muhammad Yahya Khan called on his forces to reciprocate. East Pakistan immediately seceded from Pakistan and became the sovereign nation of Bangladesh.

C -Events After the War
In 1972 Pakistani president Zulfikar Ali Bhutto (formerly the foreign minister) met with Indian prime minister Gandhi at the hill resort town of Simla in northern India to discuss a postwar settlement. Although the third Indo-Pakistani war had not been triggered by events in Kashmīr, the unresolved issues surrounding that disputed state weighed heavily in the settlement talks. The two leaders negotiated a settlement that recognized the de facto border in Jammu and Kashmīr as the Line of Control (LOC). Both sides agreed to abstain from the use of force to settle the Kashmīr dispute, and India agreed to return some 90,000 Pakistani prisoners of war.

VI -KASHMĪR: THE UNRESOLVED DISPUTE
Indo-Pakistani relations continued to be strained after the Simla Agreement, for it did not address the final status of Kashmīr. Armed hostilities continued to erupt in the territory along the LOC, making any political resolution to the dispute highly unlikely. The vast majority of India’s political establishment has indicated a willingness to settle the dispute along the LOC and formally cede the Pakistani-controlled portion of the state to Pakistan. However, Pakistan has refused to accept the status quo in Kashmīr as long as Muslim-majority areas, such as the fertile Kashmīr Valley, are under Indian administration. Meanwhile, the proliferation of nuclear weapons by both India and Pakistan since the 1970s has dramatically increased the stakes of their long-standing territorial dispute.

Both India and Pakistan acknowledge that the Simla Agreement requires them to settle their bilateral disputes without resorting to the use of force. However, neither one has been willing or able to uphold this provision, and they disagree over who is to blame for continuing violence in the territory. In addition, Indian and Pakistani officials interpret other important aspects of the Simla Agreement quite differently. Indian decision-makers believe that the agreement supersedes all former UN resolutions and requires strictly bilateral negotiations to bring a resolution to the dispute. The Pakistani side argues that the agreement leaves open the possibility of multilateral negotiations. The varying interpretations of this document aside, the two parties remain fundamentally at odds over the terms of any resolution to the dispute.

A -The Kashmīr Insurgency
Since 1989 the dispute over Kashmīr has taken on a new dimension due to the emergence of a separatist insurgency among Muslims in the Indian-controlled portion of the territory. Described as an ethnoreligious (ethnic and religious) insurgency, it initially involved mostly Muslim Kashmīris. Many Pakistanis, Afghans, and Arabs subsequently joined the insurgency, increasing its militancy. Pakistani support has helped to sustain the insurgency materially and prevent its suppression by Indian security forces.
Fighting between the insurgents and Indian security forces has resulted in more casualties than all three Indo-Pakistani wars combined. Although estimates vary, most dispassionate estimates suggest that about 40,000 individuals have lost their lives since the onset of the insurgency. Both the rebels and the Indian security forces are known to have committed substantial human rights violations.

Politically, the principal demand of the insurgency is that India hold a plebiscite to determine the status of the territory. This demand rests on the assumption that the Muslim-majority areas of the state would prevail, leading to secession from the Indian Union. Some of the insurgents support merger with Pakistan, while others want a unified, independent Kashmīr state. The most militant members of the insurgency, whose numbers have swelled in recent years, create mayhem and terror without any clear political agenda.
Meanwhile, India steadfastly refuses to hold a plebiscite on the premise that Jammu and Kashmīr State is an integral part of the Indian Union, as provided for in the Indian constitution. Elections to the state’s legislative assembly have consistently brought to power moderate candidates who support this view.

The Jammu and Kashmīr Liberation Front (JKLF) and the Hizb-ul-Mujahideen are the two principal insurgent groups of indigenous Kashmīri origins. The JKLF renounced violence in the mid-1980s. However, it has refused to enter the political process under the terms of the Indian constitution. In addition to the insurgent groups, a number of separatist organizations have banded together under the aegis of the All-Party Hurriyat Conference (APHC). The APHC has also refused to enter the political process even though its members are not involved in the insurgency.

B -Recent Developments
Since the late 1990s, the situation in Kashmīr has been especially tense. In May 1998 India and Pakistan each exploded nuclear devices during weapons tests. These demonstrations of nuclear capabilities were clearly intended to intimidate the other side. Afterwards, both sides came under intense international pressure to resolve the Kashmīr dispute, lest it escalate into a nuclear war. In an attempt to allay international concerns, Indian prime minister Atal Bihari Vajpayee accepted the invitation of his Pakistani counterpart, Nawaz Sharif, to visit Pakistan. Accordingly, Vajpayee traveled to the Pakistani city of Lahore in February 1999 to inaugurate a bus service linking it with the nearby Indian city of Amritsar. This meeting at Lahore was seen as an initial attempt to usher in a more cordial Indo-Pakistani relationship.

In early May, however, units of the Pakistani Northern Light Infantry, a paramilitary unit with troops recruited mostly from the Pakistan-administered Northern Areas, made incursions across the LOC at Dras and Kargil. Although initially caught by surprise, the Indian army responded with vigor and managed to dislodge the Pakistani intruders. Sharif, in an attempt to save face, sought and obtained the intercession of the United States from President Bill Clinton. Clinton’s agreement to intercede rested on the restoration of the sanctity of the LOC. Under Indian military and American diplomatic pressure, Sharif agreed to Clinton’s terms and the conflict was brought to a close.

In October 1999 General Pervez Musharraf, the chief of staff of the Pakistani army, overthrew Sharif’s democratically elected but increasingly authoritarian regime. Pakistan’s relations with India, which had been strained as a consequence of the Kargil conflict, worsened under Musharraf. Indian leaders accused Musharraf of continuing to materially assist the Kashmīri insurgents. Musharraf denied these allegations, insisting that his regime was only involved in providing moral, political, and diplomatic support to the insurgents.

The most dramatic deterioration in relations came after December 13, 2001, when members of two Pakistan-based insurgent groups, the Jaish-e-Muhammad and the Lashkar-e-Taiba, attacked the Indian national parliament in Delhi. Prompt action on the part of local police and paramilitary forces contained the ferocity of the attack and limited the number of deaths. In the aftermath of this attack, India recalled its ambassador from Pakistan, severed road and rail links, and dramatically increased its military deployments along the Indo-Pakistani border and in Jammu and Kashmīr State.

Relations between the two countries continued to worsen through much of 2002 as additional terrorist attacks took place on Indian soil and India continued to exert growing military pressure on Pakistan. In Kashmīr, artillery fire routinely erupted along the LOC. Both countries increased troop deployments along their shared border, amassing a total of about 1 million troops. Fearing an outbreak of war between two nuclear-armed states, the United States and a number of other major powers intervened to defuse the increasing tensions. The status of Jammu and Kashmīr remains one of the most volatile territorial disputes in the world, and India and Pakistan are no closer to reaching a resolution in the foreseeable future.
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Post Pakistan

Pakistan


I -INTRODUCTION
Pakistan, officially Islamic Republic of Pakistan, republic in South Asia, marking the area where South Asia converges with Southwest Asia and Central Asia. The capital of Pakistan is Islāmābād; Karāchi is the country’s largest city.

The area of present-day Pakistan was the cradle of the earliest known civilization of South Asia, the Indus Valley civilization (2500?-1700 BC). The territory was part of the Mughal Empire from 1526 until the 1700s, when it came under British rule. Pakistan gained independence in August 1947. It initially comprised two parts, West Pakistan and East Pakistan, which were separated by about 1,600 km (1,000 mi) of territory within India. In December 1971 East Pakistan seceded and became the independent republic of Bangladesh.

II -LAND AND RESOURCES
Pakistan is bordered on the west by Iran, on the north and northwest by Afghanistan, on the northeast by China, on the east and southeast by India, and on the south by the Arabian Sea. A panhandle of Afghanistan territory in the northwest, the Wakhan Corridor, separates Pakistan and Tajikistan. The area of Pakistan is 796,095 sq km (307,374 sq mi), not including the section of Jammu and Kashmīr under its control. Jammu and Kashmīr is a disputed territory located between Pakistan and India. Pakistan controls a portion of the territory as Azad (Free) Kashmīr and the Federally Administered Northern Areas (FANA), while India controls a portion as the state of Jammu and Kashmīr.

A -Natural Regions
Pakistan has great extremes of elevation, reaching the highest point at the Himalayan peak of K2 (also known as Mount Godwin Austen) in the north and the lowest point at the Arabian Sea coast in the south. The Indus River flows the length of Pakistan from north to south. The Indus and its tributaries form a wide river valley with fertile plains in Punjab and Sind (Sindh) provinces. Pakistan is mountainous in the north and west. Earthquakes are frequent, and occasionally severe, in the northern and western areas.
Much of Pakistan is a dry, sun-scorched region. To the west of the Indus are the rugged dry mountains of the Sulaimān Range, which merge with the treeless Kīrthar Range in the south. Farther west are the arid regions of the Baluchistan Plateau and the Khārān Basin. A series of mostly barren low mountains and hills predominate in the western border areas. The Thar Desert straddles the border with India in the southeast.
The country also possesses a variety of wetlands, with the glacial lakes of the Himalayas, the mudflats of the Indus Valley plains, and the extensive coastal mangroves of the Indus River delta. The wetland areas cover an estimated area of 7.8 million hectares (19.3 million acres).

B -Rivers
The Indus River is the lifeline of Pakistan. Without the Indus and its tributaries, the land would have turned into a barren desert long ago. The Indus originates in Tibet from the glacial streams of the Himalayas and enters Pakistan in the northeast. It runs generally southwestward the entire length of Pakistan, about 2,900 km (1,800 mi), and empties into the Arabian Sea. The Indus and its tributaries provide water to two-thirds of Pakistan. The principal tributaries of the Indus are the Sutlej, Beās, Chenāb, Rāvi, and Jhelum rivers. In southwestern Punjab Province these rivers merge to form the Panjnad (“Five Rivers”), which then merges with the Indus to form a mighty river. As the Indus approaches the Arabian Sea, it spreads out to form a delta. Much of the delta is marshy and swampy. It includes 225,000 hectares (556,000 acres) of mangrove forests and swamps. To the west of the delta is the seaport of Karāchi; to the east the delta fans into the salt marshes known as the Rann of Kutch.

C -Coastline
The coastline of Pakistan extends 1,050 km (650 mi) along the Arabian Sea. The Makran Coast Range forms a narrow strip of mountains along about 75 percent of the total coast length, or about 800 km (500 mi). These steep mountains rise to an elevation of up to 1,500 m (5,000 ft). Most of the coast is underdeveloped, with deserted beaches and only a few fishing villages.

D -Mountain Peaks and Passes
Pakistan has within its borders some of the world’s highest and most spectacular mountains. In the northern part of the country, the Hindu Kush mountains converge with the Karakoram Range, a part of the Himalayan mountain system. Thirteen of the world’s 30 tallest peaks are in Pakistan. The tallest include K2 (also known as Mount Godwin Austen), the second highest peak in the world at 8,611 m (28,251 ft), in the Karakoram Range; Nanga Parbat (8,125 m/26,657 ft) in the Himalayas; and Tirich Mīr (7,690 m/25,230 ft) in the Hindu Kush.

Many mountain passes cross Pakistan’s borders with Afghanistan and China. Passes crossing over the mountains bordering Afghanistan include the Khyber, Bolān, Khojak, Kurram, Tochi, and Gomal passes. The most well-known and well-traveled is the Khyber Pass in the northwest. It links Peshāwar in Pakistan with Jalālābād in Afghanistan, where it connects to a route leading to the Afghan capital of Kābul. It is the widest and lowest of all the mountain passes, reaching a maximum elevation of 1,072 m (3,517 ft). The route of the Bolān Pass links Quetta in Baluchistan Province with Kandahār in Afghanistan; it also serves as a vital link within Pakistan between Sind and Baluchistan provinces. Historically, the Khyber and Bolān passes were used as the primary routes for invaders to enter India from Central Asia, including the armies of Alexander the Great. Also historically significant is Karakoram Pass, on the border with China. For centuries it was part of the trading routes known as the Silk Road, which linked China and other parts of Asia with Europe.

E -Plants and Animals
The vegetation of Pakistan varies with elevation, soil type, and precipitation. Forests are largely confined to the mountain ranges in the north, where coniferous alpine and subalpine trees such as spruce, pine, and deodar cedar grow. The southern ranges of the Himalayas, which are of lower elevation, receive heavy rainfall and have dense forests of deodar, pine, poplar, and willow trees. The more arid Sulaimān and Salt mountain ranges are sparsely forested with a type of mulberry called shisham, a broad-leaved, deciduous tree. Dry-temperate vegetation, such as coarse grasses, scrub plants, and dwarf palm, predominates in the valleys of the North-West Frontier Province and the Baluchistan Plateau. The arid western hills are dotted with juniper, tamarisk (salt cedar), and pistachio trees. The area of Ziārat, Baluchistan, has juniper forests that are believed to be 5,000 years old; however, they are dwindling due to deforestation. Dry-tropical scrub and thorn trees are the predominant vegetation in the Indus River plain. Known as rakh, this vegetation is native to the region and can survive temperatures higher than 45°C (113°F). Riverine forests, found in the Indus floodplain, require six weeks of monsoon flooding to sustain them during the dry months. Irrigated tree plantations are found in Punjab and Sind. Mangrove forests in the coastal wetlands are an integral part of the marine food chain.

Animal life in Pakistan includes deer, boar, bear, crocodile, and waterfowl. The wetlands provide an essential habitat for a number of important mammal species, including coated otter, Indus dolphin, fishing cat, hog deer, and wild boar. During the migration season, at least 1 million waterfowl representing more than 100 species visit the extensive deltas and wetlands of Pakistan. Pakistan’s rivers and coastal waters contain many types of freshwater and saltwater fish, including herring, mackerel, sharks, and shellfish.

Threatened or endangered species include the snow leopard, Marco Polo sheep, blue sheep, and ibex (a type of wild goat). These animals can still be found in remote and protected areas of the Himalayas. The houbara bustard has been overhunted as a game bird in Pakistan and is officially protected.

F -Climate
The climate of Pakistan varies widely, with sharp differences between the high mountains and low plains. The country experiences four seasons. In the mountainous regions of the north and west, temperatures fall below freezing during winter and are mild during summer. In the Indus plains, temperatures range between about 32° and 49°C (about 90° and 120°F) in summer, and the average in winter is about 13°C (about 55°F).

Mountainous areas receive most precipitation as heavy snowfall in winter. In other areas of Pakistan, most precipitation comes with the summer monsoons during July and August. The summer monsoons are seasonal winds that bring torrential rainfall, breaking the hot, dry spell and providing much-needed relief. The rainfall is so heavy that it causes rivers in Punjab and Sind provinces to flood the lowland areas. Rainfall is scarce the rest of the year. Punjab Province has the most precipitation in the country, receiving more than 500 mm (20 in) per year. In contrast, the arid regions of the southeast (the Thar Desert in Sind) and southwest (Baluchistan) receive less than 125 mm (5 in) annually.

G -Natural Resources
More than 20 different types of minerals have been identified in Pakistan, but few are of sufficient quality or quantity to be commercially exploited. Most mineral deposits are found in the mountainous regions. Pakistan’s exploited natural resources include coal, natural gas, petroleum, gypsum, limestone, chromite, iron ore, rock salt, and silica sand. Pakistan has extensive natural gas reserves, notably in the vicinity of Sui, Baluchistan, from where it is piped to most of the large cities of Pakistan. Petroleum is limited, but exploration for additional reserves holds promise. Most of the country’s coal is of poor quality. The Salt Range in Punjab Province has large deposits of pure salt. Only about 3.3 percent of Pakistan’s total land area is forested, and timber is in short supply.

H -Environmental Issues
The wetlands in Pakistan are a precious resource. In an arid to semiarid environment, these ecosystems have tremendous value. People, domestic livestock, and wildlife depend on them for livelihood and survival. The wetlands are also a major source of food staples, livestock grazing and fodder, fuel wood, and irrigation water. However, the fragile wetland ecologies are threatened by poor conservation, over-exploitation, and urban and industrial pollution.

Pakistan’s forests also are in urgent need of protection and conservation. The country has one of the highest rates of deforestation in the world. The primary causes of deforestation are population growth and settlement, lack of fuelwood alternatives, insect damage and diseases, forest fires, and lack of awareness about the importance of preservation.

In the 1970s the government of Pakistan began making efforts to protect the country’s forests. It has created 14 national parks, covering a total area of 2,753,375 hectares (6,803,738 acres). The protected forests of the parks help prevent soil erosion. The parks are also wildlife sanctuaries and game reserves. Khunjerab National Park, established in 1975, is an important habitat sanctuary for a number of threatened or endangered species, including the snow leopard. It is one of the country’s most important alpine biodiversity regions. Located in the Himalayas, it is also one of the highest-altitude parks in the world at 5,000 m (16,000 ft). Most of the parks generally have no ecological basis, however, existing primarily as tourist attractions or for the preservation of game animals.

Pakistan participates in the World Heritage Convention and the Ramsar Convention on Wetlands, and it has one designated biosphere preserve under the United Nations Educational, Scientific, and Cultural Organization (UNESCO) Man and the Biosphere Program.

III -THE PEOPLE OF PAKISTAN
The people of Pakistan are ethnically diverse. They trace their ethnic lineages to many different origins, largely because the country lies in an area that was invaded repeatedly during its long history. Migrations of Muslims from India since 1947 and refugees from Afghanistan since the 1980s have significantly changed the demographics of certain areas of the country. The people of Pakistan come from ethnic stocks such as Dravidian, Indo-Aryan, Greek, Scythian, Hun, Arab, Mongol, Persian, and Afghan. Although an overwhelming majority of the people are Muslim, religion does not supercede ethnic affiliations. The people follow many different cultural traditions and speak many different languages and dialects.

Pakistan has a population of 150,694,740 (2003 estimate), yielding an average population density of 189 persons per sq km (490 per sq mi). The country’s population was increasing in 2003 at a rate of 2 percent a year. Only 33 percent of the people live in urban areas.

A -Cultural Groups
Pakistan is a multilingual and multiethnic nation. Most of the people belong to one of the country’s five major ethnolinguistic groups: Punjabis, Sindhis, Pashtuns (Pakhtuns), Mohajirs (Muslims who migrated to the newly formed nation of Pakistan after 1947), and Baluchis. Ethnically distinct subgroups exist within each of these five categories. Overall, ethnic identity is multilayered and complex and may be based on a combination of religion, language, ethnicity, and tribe.

Not all of the ethnolinguistic groups are equally represented in the power structure of Pakistan. Mohajirs, Punjabis, and Pashtuns are the dominant groups, while Sindhis and Baluchis struggle to advance and protect their interests.

Punjabis constitute 58 percent of the population. They have diverse origins, but over the centuries they coalesced into a coherent ethnic group in the historic Punjab region and developed a common language, Punjabi. Today most Punjabis prefer to read and write in Pakistan’s official language, Urdu, and their language-based ethnic identity is relatively weak. Many Punjabis are farmers in the fertile valley of Punjab Province. Punjabis also predominate in the military and the federal government.

Sindhis constitute 13 percent of the population of Pakistan. Their traditional homeland is the province of Sind, where they maintain the country’s largest concentration of large landholdings. Sindhis are a predominantly rural people. They have a strong sense of linguistic and cultural pride and identity. They have a rich literary and folk tradition and prefer to read and write in their own language, Sindhi.

Pashtuns constitute 12.5 percent of the population. Pashtuns are divided into many tribes, and their tribal structure is egalitarian. Pashtuns follow a strict code of conduct known as Pashtunwali (“Pashtun Way”). Pashtun identity, including their interpretation of Islamic law, is formulated and guided by Pashtunwali. The code is based on the absolute obligations of providing hospitality and sanctuary, even to one’s enemies, and exacting revenge at all costs in the defense of one’s honor. The code also requires Pashtuns to abide by the decisions of the jirga (council of tribal leaders) in matters of dispute. Many Pashtuns have blue eyes and claim to be descendants of the European soldiers who fought for Alexander the Great in the region 2,000 years ago. They have a rich oral tradition in their ethnic language, Pashto, but many Pashtuns prefer to read and write in Urdu. Pashtuns are primarily farmers, livestock herders, traders, and soldiers in the Pakistan military.
Baluchis constitute 4 percent of the population. Most Baluchis are nomadic, migrating wherever the desert-like conditions of their homeland, the Baluchistan Plateau, provide enough vegetation to raise their animals. Raising livestock, mainly sheep and goats, and selling their hides and wool is a way of life for the Baluchis. They also have apple, almond, and apricot orchards, and some grow wheat. Baluchi tribal organization is strictly hierarchical, and each tribe is headed by a sardar (tribal chief). Most Baluchis speak Baluchi (Balochi), a language that is similar to Persian. About one-fifth of Baluchis also speak Brahui, a Dravidian-derived language. Baluchis are the least educated and poorest segment of the population and are inadequately represented in government.

Mohajirs constitute about 8 percent of the population. They are Muslims who settled in Pakistan after the partition of British India in 1947. Unlike other cultural groups of Pakistan, they do not have a tribe-based cultural identity. They are the only people in the country for whom Urdu, the official language, is their native tongue. Mohajirs were the vanguard of the Pakistan Movement, which advocated the partition of British India in order to create the independent nation of Pakistan for Indian Muslims. After the partition, a large number of Muslims migrated from various urban centers of India to live in the new nation of Pakistan. These migrants later identified themselves as mohajirs, meaning “refugees” in both Urdu and Arabic. A large number of Mohajirs settled in the cities of Sind Province, particularly Karāchi and Hyderābād. They were better educated than most indigenous Pakistanis and assumed positions of leadership in business, finance, and administration. Today they remain mostly urban.

Sindhis felt dispossessed by the preponderance of Mohajirs in the urban centers of Sind. With the emergence of a Sindhi middle class in the 1970s and adoption of Sindhi as a provincial language in 1972, tensions between Mohajirs and Sindhis began to mount. The 1973 constitution of Pakistan divided Sind into rural and urban districts, with the implication that the more numerous Sindhis would be better represented in government. Many Mohajirs felt that they were being denied opportunities and launched a movement to represent their interests. The movement, which evolved into the Mohajir Qaumi Movement (MQM) in the mid-1980s, called for official recognition of Mohajirs as a separate cultural group and advocated improved rights for Mohajirs. Although factional rivalries and violence within the MQM tarnished its image and shrunk its power base, the movement continues to be a potent force in urban centers of the province, particularly Karāchi. The MQM has contributed to a more defined Mohajir identity within the country.

B -Political Regions
The ethnic groups of Pakistan are distributed according to their historical settlement in the region. The current political regions of Pakistan roughly correspond to the settlement patterns established long before the partition of British India in 1947, when Pakistan was created as a homeland for Indian Muslims. The four provinces are Punjab, the Muslim portion of the historic Punjab region; Sind, the traditional homeland of the Sindhis; the North-West Frontier Province, a small portion of the Pashtun tribal lands; and Baluchistan, a portion of the Baluchi tribal lands. The traditional homelands of the Pashtuns and Baluchis extend beyond the modern political borders, both provincial and national.

Punjab is the most populated province of Pakistan, with 72.6 million people (1998). Most of the people are Punjabis. The province contains most of the country’s largest cities, but the rural agricultural areas are also densely settled. The province is the second largest in area.

Sind is the second most populated province in Pakistan, with about 30 million people (1998). Its population is the most urbanized in Pakistan. Sindhis make up about 60 percent of the population of Sind, living mostly in rural areas. Mohajirs constitute the remaining 40 percent and live mostly in the province’s large cities. Sind is the third largest province in area.

The North-West Frontier Province (NWFP) has a population of 17.6 million (1998). The majority of the people are Pashtuns. The province is part of the historic Pashtun tribal lands, which extend throughout southern and southeastern Afghanistan and well into western Pakistan, including the Federally Administered Tribal Areas and northern Baluchistan. The NWFP is Pakistan’s smallest province in area. In the 1980s refugees from war-torn Afghanistan began to settle in the province. Refugee camps and rudimentary villages were set up in the border areas. A large number of refugees also established communities in cities such as Peshāwar. Many became semipermanent residents of Pakistan because Afghanistan remained in a state of war through the mid-1990s. The majority of refugees were Pashtuns, facilitating their assimilation into the province’s population, in many cases through intermarriage.

Baluchistan is the most sparsely populated and least developed province of Pakistan. A majority of the 6.5 million (1998) people who live in Baluchistan are Baluchis. Pashtuns are the second largest ethnic group in the province. In recent years a large number of Afghan refugees have settled in Baluchistan. In area, Baluchistan is the largest province of Pakistan, covering nearly 40 percent of the country’s total territory. However, the province is an arid and inhospitable hinterland.

C -Principal Cities
Pakistan’s largest city is Karāchi, the capital of Sind Province. It is the country’s only seaport and a major financial, industrial, and commercial center. It is also known as the ethnic melting pot of Pakistan. Lahore, the capital of Punjab Province, is Pakistan’s second largest city and a cultural and educational center. Faisalābād, in central Punjab, is the center of textile and fertilizer industries. Multān, the largest city in southern Punjab, has many ancient Muslim shrines, a huge fertilizer factory, and small cottage industries such as carpet weaving and pottery. Hyderābād, in Sind Province, is a manufacturing center with textile and glass factories, as well as a cultural center with museums, historic mosques, and a medical school. Peshāwar, the capital of the North-West Frontier Province, is a busy, overcrowded frontier outpost and a hub of trade with Afghanistan. For centuries it served as a gateway and trading post between Afghanistan and Southeast Asia.

Islāmābād is the capital of Pakistan and the seat of the federal government; it forms its own administrative unit, the Islāmābād Capital Territory. Just to the south, in bordering Punjab Province, is Rāwalpindi, the headquarters of the Pakistani army and an industrial center.

D -Religion
Islam is the faith of about 97 percent of the people of Pakistan. About three-quarters of the country’s Muslims are Sunni, and about one-quarter are Shia. Some small Muslim fringe sects, such as the Ahmedis and Zikris, also exist. Hindus and Christians form the largest religious minorities, accounting for about 3 percent of the population. Other religious groups include Sikhs, Parsis, and a small number of Buddhists. The constitution defines Pakistan as an Islamic state but guarantees freedom of religion.

E -Languages
Urdu is the official language of Pakistan. It is the first language of only a small percentage of the population, but it cuts across linguistic and provincial boundaries as the national language. More than 75 percent of Pakistanis can speak and understand Urdu. In urban areas about 95 percent of the people communicate in Urdu. Urdu replaced English as the official language in 1978.
Most Pakistanis speak at least two languages. A large segment of the population is trilingual, speaking English, Urdu, and an ethnic-based regional language. Punjabi, Pashto, Sindhi, Baluchi, and Brahui are the major regional languages. These languages have many regional dialects, including Saraiki, a widely spoken dialect of Punjabi. Regional languages are recognized as a potent force because language and ethnic identity are closely interrelated; even the national census categorizes groups according to their language, rather than their ethnicity. However, there is growing awareness among Pakistanis that for social mobility, national cohesion, and individual success, it is imperative to be fluent in Urdu and proficient in English.

Several factors contributed to the establishment of Urdu as the lingua franca of Pakistan. It was the language of the educated Muslims in northern India, who spearheaded the Pakistan Movement. Urdu helped foster a linguistic identity among Muslims in the region. Although similar to Hindi as a spoken language, Urdu uses a Persian-derived script and incorporates many Arabic words. Choosing Urdu as the national language provided a linguistic basis for the formation of a Muslim national identity. It also provided the country with a “neutral” language because Urdu does not have ethnic or tribal associations. Since the founding of Pakistan in 1947, state-controlled electronic and print media have promoted Urdu. In the public schools of the country, Urdu is the principal language of instruction.

For all practical purposes, however, English is the de facto official language. Pakistan’s legal system is based on British common law, and judicial and government documents are mostly written in English. Pakistanis of all social strata strive to learn English, which has a certain elite status. Although the quality of instruction in English has declined, English continues to be the language of the educated and those who want to move ahead in life.

F -Education
Pakistan has one of the lowest literacy rates in the world. In 2003 only 45.7 percent of adult Pakistanis were literate. Male literacy was 59.8 percent, while female literacy was 30.6 percent. From 1976 to 2001 the number of primary schools doubled, but so did the population. High levels of population growth continue to hamper educational development in the country. The government launched a nationwide initiative in 1998 with the aim of eradicating illiteracy and providing a basic education to all children.

According to the constitution, it is the state’s responsibility to provide free primary education. Five years has been established as the period of primary school attendance, but attendance is not compulsory. While the enrollment rate in primary school is high for boys, less than one-half of girls attend school. In the 1999–2000 school year 96 percent of primary school-aged children were enrolled in school, while only 39 percent of secondary school-aged children attended. In 1996, 3.5 percent of Pakistan’s college-aged population attended institutions of higher education. The wealthiest and best students seek education in British and American universities.

At the time of independence Pakistan had only one university, the University of the Punjab, founded in 1882 in Lahore. Pakistan now has more than 20 public universities. Among Pakistan’s leading public institutions of higher education are Quaid-e-Azam University (1965), in Islāmābād, the University of Karāchi (1951), the University of Peshāwar (1950), and the University of Sindh (1947), near Hyderābād.

Since 1978 the government has encouraged the privatization of education at all levels. This led to the creation of three major private universities: Lahore University of Management Sciences (LUMS), Agha Khan University Medical College (in Karāchi), and Ghulam Ishaq Khan Institute of Engineering Sciences and Technology (in Topi, North-West Frontier Province). The National University of Sciences and Technology (NUST), in Rāwalpindi, conducts research in the fields of science and technology for both the public and private sectors.

IV -THE ARTS
Pakistan has a rich and diverse cultural heritage. Pakistanis celebrate their culture through folk music, dance, and festivals. They have a strong appreciation for poetic expression and storytelling. The history of the country comes to life in the splendid architectural detail of centuries-old mosques and forts. After it became part of the expansive Mughal Empire in 1526, the region that is now Pakistan entered a golden age of literature, architecture, and music.

A -Literature
Most Pakistanis adore poetry and commonly memorize long poems. A mushaira (poetry reading) in Pakistan can attract hundreds of listeners. Among classical poets in the Urdu language, Mirza Ghalib is perhaps the most widely admired. Ghalib, who wrote in the 19th century, is known for his lyrical and spiritual ghazals. Ghazals are the most popular form of poetry in the Urdu and Persian languages.

The official national poet of Pakistan is Allama (“the Wise”) Muhammad Iqbal. He earned the title of poet-philosopher of Pakistan not only because he was an exceptionally talented poet, but also because he was active in the politics of his time. In 1930 he called for the creation of a separate Muslim state in northwestern British India. He wrote poetry in Urdu and Persian and gave university lectures in English.

Faiz Ahmed Faiz is perhaps the most adored modern poet in Pakistan. Faiz began writing poetry in the 1950s after a distinguished journalism career. His ghazals are primarily concerned with class struggle, rather than the conventional themes of love and beauty. A progressive writer, Faiz was also a political dissident, and military governments banned his poetry from television and radio. Ahmad Fraz, Muneer Niazi, and Parveen Shakir are some of the other popular Urdu-language poets of Pakistan.

Shah Abdul Latif Bhitai, a Sufi mystic who in the first half of the 18th century wrote about love and Sindhi life, is the most revered poet of the Sindhi language. His poetry is widely recited by illiterate and educated Sindhis alike. Khushal Khan Khattak is the most famous poet of the Pashto language. In the 17th century he wrote poetry describing the beauty of women and nature, using military metaphors. The most well-known poet of the Punjabi language is Bulleh Shah, of the 17th century, whose poetry challenged the religious orthodoxy. In recent years short stories and travelogues have gained literary prominence, in addition to poetry.

B -Music and Film
The classical music tradition in Pakistan traces its roots to the 13th-century poet and musician Amir Khusru, who composed the earliest ragas, the traditional rhythmic form. To play the ragas, Muslim musicians invented the sitar, a long guitar-like stringed instrument, and the tabla, a small pair of hand drums.

Qawwali, a form of devotional song, arose as part of the Sufi (Islamic religious sect) tradition. This rich vocal tradition is based on melodic and free-rhythmic song-poems and classical musical forms. It is traditionally performed at the shrines of Sufi saints, but today qawwali singers also perform for major secular events. Qawwali singer Nusrat Fateh Ali Khan won international popularity in the late 20th century by infusing qawwali performances with new form and style. Other traditional musical forms—including the Punjabi bhangra, the Sindhi juhumar, and the Pashtun khattack—have also acquired new forms and continue to be popular for dancing. Punjabi, Pashto, and Sindhi folk songs are popular in rural Pakistan. Modern Pakistani musical groups and singers have introduced new forms of pop music based on traditional melodies.

Most Pakistanis prefer and enjoy songs from Pakistani and Indian movies. These songs are commonly played on radio and television. A synthesis of musical scores from movies, traditional folk music, and popular Western music is gaining popularity.

The film industry of Pakistan, known as Lollywood, is concentrated in Lahore. Most Pakistani movies are long, melodramatic love stories with plenty of songs. The film industry is often regulated and censored by the government. Films must follow the conventions of Islamic law, and the showing of physical contact such as kissing is prohibited. In the mid-1970s the industry produced about 150 movies a year, but since then the number has declined. In the 1980s the market for Pakistani films shrunk as a result of restrictions imposed by the military regime of Muhammad Zia ul-Haq and the availability of smuggled videotapes of Indian and Western movies.

Television became a major cultural influence in Pakistan in the 1980s, when the state-controlled network, Pakistan Television, attained national reach. It aired both Pakistani and American shows. In recent years satellite and cable television services have significantly increased access to international networks offering many different cultural and political perspectives.

C -Architecture
Pakistan has inherited a combination of Mughal and British colonial architectural forms. Mughal architects combined the Muslim preferences for large domes, slender towers, and archways with the Hindu use of red sandstone, white marble, and inlaid jewels. Mughal artists decorated the monuments with verses from the Quran, the sacred text of Islam. The best example of this architecture is the Badshahi Mosque and Lahore Fort (built between the 1580s and 1670s). The courtyard of the mosque can accommodate 100,000 worshipers, making it the second largest mosque in the world. Pakistan also has the world’s largest mosque, the Faisal Mosque in Islāmābād, a gift from Saudi Arabia that was constructed in the 1980s. It was designed by a Turkish architect to look like an Arab desert tent. Other examples of Mughal architecture include Shalimar Gardens (laid out in 1641), in Lahore; the Shah Jahan Mosque (17th century), in Thatta, Sind Province; and the mid-18th-century tomb of the great Sindhi poet Shah Abdul Latif Bhitai, in Bhit Shāh, near Hyderābād.

Quranic calligraphy and miniature painting have a strong tradition in Pakistan dating to Mughal rule. The most celebrated miniature and mural paintings and calligraphic works were created in the 20th century by Abdul Rehman Chughtai and Sadequain. These Mughal traditions are also visible on colorfully painted and decorated trucks and buses that ply the country.

D -Libraries and Museums
Karāchi is the seat of some of the most important libraries in Pakistan; these include the Liaquat Memorial Library (1950), the Central Secretariat Library (1950), and the University of Karāchi library. Also of note are the National Archives of Pakistan, in Islāmābād, and the Punjab Public Library (1884), in Lahore.

The National Museum of Pakistan (1950), in Karāchi, is noted for its archaeological material from the Mohenjo-Daro and Harappa sites in the Indus Valley. Important materials from this ancient civilization are also found at the Institute of Sindhology, in Jām Shoro, and the Hyderābād Museum. The Lahore Museum (1864), the country’s largest museum, and the Peshāwar Museum (1906) also have exhibits on the rich cultural history of the region. The Industrial and Commercial Museum, in Lahore, contains exhibits on the manufactures of Pakistan. The National Museum of Science and Technology is a participatory science center in Lahore.

V -ECONOMY
Like most developing countries, Pakistan is confronted with the problems of rapid population growth, sizable budget deficits, and heavy dependence on foreign aid and loans. The economy is strained from supporting a large military establishment and from providing for the needs of Afghan refugees.
Pakistan receives considerable economic assistance from foreign countries and from international organizations. Over the years Pakistan has accumulated a foreign debt of about $40 billion. Debt repayment, defense spending, and general administrative expenditures consume 80 percent of Pakistan’s annual budget. Only 20 percent is available for development of the social sector. After Pakistan exploded a nuclear device in May 1998, it faced the imposition of international sanctions. The fact that the country survived the sanctions without a collapse of its currency or violent street demonstrations is generally regarded as proof of the country’s resilience. Heading into the 21st century, Pakistani leaders have a chance to seize the moment in order to modify and build a sound social and economic order that may steer the nation to a more durable path of progress.
In 2001 Pakistan’s gross domestic product (GDP) was $58.7 billion. The government budget in 2000 included $9.9 billion in revenues and $13.5 billion in expenditures.

A -Economic Development
After East Pakistan seceded to become the independent nation of Bangladesh in December 1971, the elected government of Zulfikar Ali Bhutto tried to pick up the pieces of a truncated Pakistan. It devised economic policies that led to a drastic devaluation of the Pakistani currency, thereby boosting agricultural exports. To ease unemployment pressure the government encouraged the export of Pakistani labor to the Middle East. It also embarked on the nationalization of industries, banks, and agriculture-based industries. This expansion of the public sector ultimately shook private-sector confidence so that investment plummeted. The annual growth rate declined, averaging between 2.7 percent and 3.7 percent during most of the 1970s.

During the 1980s the country’s economy grew an average rate of 6 percent annually. This high growth rate was largely created by three factors: aid from the United States, the influx of foreign exchange from Pakistanis working abroad, and high crop yields. First, Pakistan received an average of $600 million per year in economic and military aid from the United States from 1981 to 1989, largely because of Pakistan’s support for anti-Soviet forces in the Afghan-Soviet War. (During this decade Pakistan was the third-largest recipient of U.S. aid, after Israel and Egypt.) Second, Pakistan received $2.5 billion in remittances from Pakistanis working abroad in the Persian Gulf States and other countries. Third, good weather conditions produced bumper cotton and wheat crops.

At the same time, the government did little to devise policies to boost the confidence of private investors or promote the welfare of Pakistani citizens. The negative fallout of the Afghan war on Pakistan was an expansion of the black market (the illicit sale of commodities) and the proliferation of portable weapons and violence. Despite the high economic growth rate, the economy remained largely agricultural, and socioeconomic disparities between the rich and poor widened. Also during the 1980s, the military regime increased defense spending to such an extent that the fiscal deficit rose to 10 percent of the GDP. In addition, public debt ballooned from less than 40 percent of the GDP to more than 80 percent. The debt trap that Pakistan finds itself in today originated during this decade.

The economy of Pakistan slowed to an average annual growth of 3.8 percent during the 1990s. Factors contributing to the sluggish growth included corruption and mismanagement at the highest levels of government and the rise of ethnic and sectarian violence in Karāchi and other urban centers. These factors shook investor confidence.

The economic performance of the 1990s was also related to the structural adjustment programs (SAPs) of the World Bank and the International Monetary Fund (IMF). Loans from these international lending agencies were subject to conditions on Pakistan’s national economic policies. Pakistan received its first formal loan in 1988. In Pakistan the primary focus of the IMF-sponsored program was to lower the budget and current-account deficits. These objectives were to be achieved by reducing public expenditures and broadening the tax base. In addition, in 1992-1993 the IMF further insisted that Pakistan reduce defense expenditures, impose an agricultural tax, and improve methods of tax collection. These reforms were never fully implemented, however, and the IMF-sponsored program did not achieve the desired result. Inflation rose from 8 percent in the 1980s to 11 percent in the 1990s, although a nominal reduction in the budget deficit was visible. Direct foreign investment did not improve and the export sector remained sluggish.

A high-powered Privatization Commission was created in 1990 to encourage privatization of public-sector industries, economic deregulation, and other reforms designed to boost confidence in the principles of a free-market economy. However, the commission was slow to implement its privatization program.

B -Agriculture
About 28 percent of Pakistan’s total land area is cultivated. Agriculture and related activities, including fishing, engage 47 percent of the workforce and provide 25 percent of the GDP. Chief cash crops are cotton (textile yarn and fabrics produce more than one-half of export earnings) and rice. Principal crops in 2002 (with output in metric tons) included sugarcane, 48 million; wheat, 18.5 million; rice, 5.8 million; cotton lint, 5.1 million; and corn, 1.7 million. Livestock included cattle, water buffalo, sheep, goats, and poultry.
Land reform is a controversial issue in Pakistan. At independence in 1947, a large proportion of the arable land was concentrated in a small number of large estates, many of them owned by absentee landlords and cultivated by tenant farmers. Land reforms introduced in 1959 provided some security of tenure to tenants but did little to break up the large estates. In the 1970s the government of Zulfikar Ali Bhutto introduced more extensive land reforms.

The amount of land any individual could own was significantly reduced, and landlords were not compensated for the land they surrendered. Most of the expropriated land was distributed to tenants, but the government retained land that was not suitable for farming. Landlords strongly resisted the reforms, however, and the government bureaucracy was somewhat lax in enforcing them. In the end, the reforms shook the landlords but did not break their hold. By the end of the 20th century, about half of the country’s arable land was held by only a small percentage of wealthy landowners.
The Bhutto government also developed favorable credit and loan policies for farmers. The tractor became the new status symbol in rural Pakistan. Improved mechanization gave a boost to agricultural productivity. Formerly an importer of wheat, Pakistan achieved self-sufficiency in the grain by the late 1970s.

C -Fishing
Fishing resources, although underdeveloped, are extensive. In 1999 the catch was 674,606 metric tons, three-quarters of it obtained from the Indian Ocean. Types of fish caught include sardines, sharks, and anchovies; shrimp are also an important part of the industry.

D -Mining
In the early 1990s the most important nonfuel minerals (with annual production in metric tons) included gypsum (532,000), rock salt (895,000), limestone (8.8 million), and silica sand (154,000). In 2001 coal production was 3.20 million metric tons, crude petroleum production reached 23.3 million barrels, and production of natural gas was 23.4 billion cubic meters (826 billion cubic feet).

E -Manufacturing
The manufacturing capacity of Pakistan is still small, but production has been steadily expanding. In 2001 manufacturing accounted for 16 percent of the GDP. About 17 percent of the labor force is engaged in industry, including manufacturing and mining. Important products include processed foods, cotton textiles, silk and rayon cloth, refined petroleum, cement, fertilizers, sugar, cigarettes, and chemicals. Many handicrafts, such as pottery and carpets, also are produced.

F -Energy
Pakistan’s total output of electricity in 2001 was 67 billion kilowatt-hours. Hydroelectric dams on the Indus and its tributaries help furnish the country’s energy needs, but the supply of hydroelectricity drops sharply during the dry winter months. About 28 percent of the country’s electricity is produced through dams. The country also has natural-gas fields. About 69 percent of the country’s electricity is generated in thermal installations fueled by natural gas and petroleum.

Pakistan has two nuclear power plants, but neither produces a significant amount of electricity. The Karāchi plant was built with Canadian help in the early 1960s, and the Chashma plant, on the Indus River in southern Punjab, was built in the 1980s with financial support from China.

Pakistan is not self-sufficient in energy production. The country relies on imported petroleum to fuel its electricity-generating thermal plants. However, the country’s exports bring in hardly enough revenues to meet the cost of petroleum imports. During the 1990s rising oil prices had a devastating effect on the economy, leading to a rise in the country’s foreign debt.

G -Currency and Banking
The basic monetary unit is the Pakistani rupee, consisting of 100 paisa (61.93 rupees equal US$1; 2001 average). The State Bank of Pakistan, established in 1948, issues banknotes; manages currency and credit, the public debt, and exchange controls; and supervises the commercial banks. Pakistani banks were nationalized in 1974, but in the early 1990s the country transferred two banks to private ownership and issued licenses for ten new commercial banks. A number of major foreign banks maintain offices in the country. In conformity with Islamic doctrine, domestic banks in Pakistan have redefined the payment and collection of interest as profit. Investment partnerships between the bank and the customer have replaced loans at interest.

H -Foreign Trade
The foreign trade of Pakistan consists largely of the export of raw materials and basic products such as cotton yarn and the import of manufactured products. In 2000 exports earned $9.1 billion and imports cost $11.1 billion. The chief exports were cotton textiles, cotton yarn and thread, clothing, raw cotton, rice, carpets and rugs, leather, fish, and petroleum products; the main imports were machinery, electrical equipment, petroleum products, transportation equipment, metal and metal products, fertilizer, and foodstuffs.
The United States is the largest trading partner of Pakistan. The United States is also one of the largest contributors of direct foreign investment in Pakistan. In 2000 Pakistan imported more than $646.5 million worth of U.S. products, mostly wheat, chemicals, fertilizers, machinery, and transport equipment. Pakistan’s exports to the United States amounted to $2.12 billion. Pakistan’s other trading partners are Japan, the United Kingdom, South Korea, Saudi Arabia, China, Germany, Hong Kong, France, the Persian Gulf States, and Iran.

I -Transportation
The lack of modern transportation facilities is a major hindrance to the development of Pakistan. Its terrain, laced with rivers and mountains, presents formidable obstacles to internal overland transportation. The country has 254,410 km (158,083 mi) of roads. The railroad network totals 7,791 km (4,841 mi).

Karāchi is the principal port of Pakistan. The coastline is underdeveloped because of the rugged topography, but it has promise for development. In recent years successive governments of Pakistan have made efforts to build infrastructure along the Makran Coast. Toward this end, the government of Pakistan signed an agreement with China in the late 1990s to develop an international shipping port at Gwādar as an alternative to Karāchi. Gwādar is located on a peninsula that is accessible to large ships traveling from the Gulf of Oman, which leads to the Persian Gulf.

The Karakoram Highway was constructed between China and Pakistan in 1978 and opened to regular traffic in 1982. This all-weather road is 1,300 km (800 mi) long and passes through the Himalayas, reaching an elevation of 5,000 m (16,000 ft) at Khunjerab Pass. It is of strategic significance for Pakistan and China, connecting Islāmābād with Kashgar, in the Xinjiang Uygur Autonomous Region of China.

Pakistan International Airlines (PIA), the national airline, is in large part government owned. PIA offers flights within Pakistan and to a number of other countries. Many privately owned international airlines also serve Pakistan. In the early 1990s the government ended the airline’s monopoly on domestic service, and a number of private carriers have since begun domestic operations. The country’s main international airports serve Karāchi, Lahore, Islāmābād, and Rāwalpindi.

J -Communications
In 2001 Pakistan had 23 telephone mainlines for every 1,000 people. The number of cellular-phone subscribers is growing rapidly. Radio receivers number 94 and television sets 131 per 1,000 residents.

Television broadcasting began in Lahore in 1964 and in Karāchi in 1966. Since then television-broadcasting centers have been set up in Peshāwar, Rāwalpindi, Islāmābād, and Quetta, giving the Pakistani television network an almost total nationwide reach. In the early 1990s satellite dishes made it possible for international television programming to reach even the remotest areas of the country. More recently, the availability of cable television has improved accessibility to the international networks. Newspapers are mainly printed in Urdu and English. Pakistan has 352 daily newspapers, most with small circulations. The major dailies are concentrated in Lahore, Karāchi, and Islāmābād.

VI -GOVERNMENT
Since independence in 1947 Pakistan has had three constitutions, adopted in 1956, 1962, and 1973, consecutively. The 1973 constitution was the result of consensus among the political parties that were represented in the parliament. After a military coup d’état in 1977, martial law was imposed and the constitution was suspended. In 1985 a civilian government was reestablished, and the 1973 constitution was restored, although in a radically amended form. The Eighth Amendment confirmed and legalized all acts and orders that had been issued under the martial law regime, including amendments to the constitution. The amended constitution significantly expanded the powers of the president. It also included clauses that promoted Islam as the supreme law of Pakistan. In 1997, however, the constitution was amended to repeal the main provisions of the Eighth Amendment, stripping the president of the power to dismiss the prime minister and dissolve the parliament. After another military coup in 1999, the constitution was suspended and the democratically elected parliament was dissolved. In August 2002 a presidential decree amended the constitution to grant sweeping powers to the president. Parliamentary elections were held in October to restore civilian rule in the country. The 1973 constitution was formally revived in November.

A -Executive
Pakistan’s head of state is a president. Under the constitution, the president is elected to a five-year term by members of the national and provincial legislatures. A prime minister is the chief executive official. After legislative elections, the president appoints the leader of the majority party or majority coalition in the legislature to serve as prime minister. As amended in August 2002, the constitution allows the president to dissolve the national legislature, appoint military chiefs and Supreme Court justices, and chair the National Security Council, a quasi-military advisory body.

B -Legislature
Under the constitution, legislative power is vested in the bicameral Federal Legislature. The National Assembly (lower house) has 342 seats; 60 of these seats are reserved for women and 10 are reserved for non-Muslims on a basis of proportional representation. Members of the National Assembly are directly elected for five-year terms. The Senate (upper house) has 87 seats; senators are elected indirectly by the provincial and national legislatures for six-year terms.

C -Judiciary
The highest court in Pakistan is the Supreme Court. The judicial system in each province is headed by a high court. There is also a federal Sharia Court, which hears cases that primarily involve Sharia, or Islamic law. Legislation enacted in 1991 gave legal status to Sharia. Although Sharia was declared the law of the land, it did not replace the existing legal code.

D -Local Government
According to the constitution, Pakistan is a federation. The country is divided into four autonomous (self-governing) provinces; two federally administered areas; and the Islāmābād Capital Territory, which consists of the capital city of Islāmābād.

The four provinces are Baluchistan, the North-West Frontier Province (NWFP), Punjab, and Sind. The provinces are headed by governors appointed by the president. Under the constitution, each province has a directly elected provincial assembly headed by a chief minister. However, the provincial assemblies were suspended following the 1999 military coup.
The Islāmābād Capital Territory, the Federally Administered Tribal Areas (FATA), and the Federally Administered Northern Areas (FANA) are under the jurisdiction of the federal government. In the FATA, however, tribal leaders manage most internal affairs. Azad (Free) Kashmīr has a separate and autonomous government but maintains strong ties to Pakistan. Control of the territory included within FANA and Azad Kashmīr is a matter of dispute between Pakistan and India.

E -Political Parties
Pakistan’s founding nationalist party, the Muslim League, dissolved after martial law was imposed in 1958. The Pakistan Muslim League (PML) founded in 1962 bore little resemblance to the original party. The PML subsequently splintered into several factions. In the aftermath of the military coup of 1977, political parties were banned from 1979 until civilian rule was restored in 1985. Although political parties were not banned after the military coup of 1999, they could not participate in government because the parliament and provincial assemblies were dissolved. Many political parties participated in the October 2002 elections that restored civilian rule in Pakistan.

The main political groups are the Pakistan Muslim League (Quaid-e-Azam), or PML-Q, a faction of the PML that generally supports President Pervez Musharraf and the military; the Pakistan Muslim League (Nawaz), or PML-N, the PML faction that remains loyal to former prime minister Nawaz Sharif; the Pakistan People’s Party (PPP), led by former prime minister Benazir Bhutto and the largest party within the Alliance for the Restoration of Democracy (a 15-party pro-democracy bloc); and the Muthida Majlis-e-Amal (United Council of Action), an alliance of six hardline Islamic groups.

F -Health and Welfare
Health services in Pakistan are limited by a lack of facilities. In 1999 the country had one physician for every 2,703 people and one hospital bed for every 1,535 people. In 1976 an old-age pension system was inaugurated, but it covers relatively few Pakistanis.

G -Defense
Military service in Pakistan is voluntary. In 2001 the country’s armed forces had 620,000 members, including 550,000 in the army, 45,000 in the air force, and 25,000 in the navy. Another 247,000 were in paramilitary units.

VII -HISTORY
The area of present-day Pakistan has a long history of human settlement as the cradle of the Indus Valley civilization, the earliest-known civilization in South Asia. This Bronze Age culture flourished in the area of the Indus River Valley from about 2500 to 1700 BC. The Indus River is considered the lifeblood of Pakistan, and the ancient culture that arose there serves as an icon of Pakistan’s territorial identity. Important archaeological sites in Pakistan include Mohenjo-Daro (Sindhi for “Mound of the Dead”), in Sind Province, and Harappā, near the Ravi River (a tributary of the Indus) in Punjab Province.

Pakistan’s cultural identity is traced to the centuries of Muslim rule in the region. In AD 711 Mohammad bin Qasim, an Arab general and nephew of Hajjaj, ruler of Iraq and Persia, conquered Sind and incorporated it into the Umayyad Caliphate. Thereafter Muslims continued to rule areas of present-day Pakistan for almost 1,000 years. For the first 300 years the region of Sind was the only part of the Indian subcontinent that was under Muslim rule. Muslim rule began to spread to other areas after the Afghan sultan Mahmud of Ghaznī, leader of the Ghaznavids, invaded in 997. After he conquered the region of Punjab in the early 11th century, he made Lahore his capital. Between 1175 and 1186 the regions of Sind and Punjab were conquered by Muhammad of Ghur, leader of the Turkish Ghurid Empire, which was centered in what is now west central Afghanistan. His generals conquered all of north India by the time he was assassinated in 1206.

That year his general Qutubuddin Aybak laid the foundations of an independent Muslim kingdom in India, the Delhi Sultanate. Thirty-five sultans ruled this rich and powerful sultanate from 1206 to 1526. The sultanate included most of Punjab and Sind during this period.

The golden age of Muslim rule in the Indian subcontinent came with the glory and grandeur of the Mughal Empire (1526-1858). Between 1526 and 1707 six powerful Mughal kings ruled in succession: Babur, Humayun, Akbar, Jahangir, Shah Jahan, and Aurangzeb. As the boundaries of the empire grew, Islam spread in India through incoming Muslim rulers, intermarriages, conversions among the lower Hindu castes, and the teachings of Sufi mystics. The death of Aurangzeb in 1707 marked the beginning of the decline of the Mughal Empire, and of Muslim rule in India.

A -British Rule
The waning control of the Mughal Empire left the subcontinent vulnerable to new contenders for power from Europe. The British changed the course of history by penetrating India from the Bay of Bengal, in the east; until then invading forces had entered India from the northwest, mostly by way of the Khyber Pass. The English East India Company established trading posts in Bengal and represented British interests in the region. In 1757 company forces defeated Mughal forces in Bengal in the Battle of Plassey.

This victory marked the beginning of British dominance in the subcontinent. The company continued to expand the area under its control through military victories and direct annexations, as well as political agreements with local rulers. The British annexed the area of present-day Sind Province in 1843. The region of Punjab, then under the control of the Sikh kingdom of Lahore, was annexed in 1849 after British forces won the second of two wars against the Sikhs. Some areas of Baluchistan were declared British territory in 1887.

As the British sought to expand their empire into the northwest frontier, they clashed with the Pashtun tribes that held lands extending from the western boundary of the Punjab plains into the kingdom of Afghanistan. The Pashtuns strongly resisted British invasions into their territories. After suffering many casualties, the British finally admitted they could not conquer the Pashtuns. In 1893 Sir Mortimer Durand, the foreign secretary of the colonial government of India, negotiated an agreement with the king of Afghanistan, Amir Abdur Rahman Khan, to delineate a border. The so-called Durand Line cut through Pashtun territories, dividing them between British and Afghan areas of influence. However, the Pashtuns refused to be subjugated under British colonial rule. The British compromised by creating a new province in 1901, named the North-West Frontier Province, as a loosely administered territory where the Pashtuns would not be subject to colonial laws.

The British maintained their empire in the Indian subcontinent for nearly 200 years. The first 100 years were marked by chaos and crisis. The Sepoy Rebellion, also known as the Indian War of Independence, erupted in 1857 and became a widespread revolt against British rule. After the British quelled the rebellion in 1858, they immediately took steps to maintain control. The British government officially abolished the Mughal Empire and exiled Muhammad Bahadur Shah to Burma. In addition, the British government transferred authority from the English East India Company to the British crown, establishing direct imperial rule in India. To help consolidate control the British initiated a series of educational, administrative, and political processes between 1858 and 1900. English was introduced as the official language.

The Muslim response to the imposition of British rule evolved around the ideas and leadership of Sir Syed Ahmad Khan. In 1875 Sir Syed founded Muhammadan Anglo-Oriental College (now Aligarh University) because he believed that Muslims could best improve their social and economic standing by gaining a Western education, rather than the traditional Islamic education. He encouraged Muslims to pursue higher education based on the Western model as a way to advance themselves, and their community, in the new order. He also encouraged Muslims to seek government jobs and show loyalty to the British Raj. At the same time he sought British patronage for improving the lives of the Muslims of India. He demanded a separate Muslim electorate, arguing that Muslims were at a disadvantage among India’s overwhelming majority of Hindus. Hindus also were advancing themselves in the new order more quickly than Muslims, the majority of whom held low socioeconomic status as farmers and laborers. The emerging educated Muslim groups found Sir Syed’s ideas inspiring.

In the 1880s the British initiated political reforms that allowed the formation of political parties and local government. The Indian National Congress was created in 1885 to advocate for Indian autonomy from British rule. Many Muslims believed the organization focused on Hindu interests, however, and in 1906 Muslims formed the Muslim League to represent their interests. Muslims demanded, and were granted, separate electorates in the Government of India Act of 1909. This guaranteed Muslims representation in the national and provincial legislative councils, although the authority of these legislative councils was severely limited under the British colonial government. Both Muslims and Hindus demanded autonomy (self-government), and in 1919 constitutional reforms were introduced that gave the legislative councils greater authority. However, the reforms fell short of granting autonomy and did not satisfy political demands. The Amritsar Massacre of 1919 further galvanized nationalist, anti-British sentiment.

The concept of an autonomous Muslim state was publicly proposed during the Allahābād session of the Muslim League in 1930 by the leading Muslim poet-philosopher in South Asia, Mohammad Iqbal. He envisioned a system in which areas that had Muslim majorities would constitute an autonomous state within India. During the next decade, this concept evolved into the demand for the partition of India into separate Muslim and Hindu nations, known as the Two Nations Theory. In 1940 Muslim League president Mohammed Ali Jinnah presided over the organization’s annual session, held that year at Lahore, in which the League made its first official demand for the partition of India. The Lahore Resolution called for an independent, sovereign Muslim state.

During preindependence talks in 1946, the British government found that the stand of the Muslim League on separation and that of the Congress on the territorial unity of India were irreconcilable. The British then decided on partition and on August 14, 1947, granted independence to Pakistan. India gained its independence the next day. They both became independent dominions within the Commonwealth of Nations. Pakistan came into existence in two parts: West Pakistan, coextensive with the country’s present boundaries, and East Pakistan, now known as Bangladesh. The two were separated by 1,600 km (1,000 mi) of Indian territory.

B -Problems of Partition
The division of India caused tremendous dislocation of populations. Some 3.5 million Hindus and Sikhs moved from Pakistan into India, and about 5 million Muslim refugees (known as Mohajirs) migrated from India to Pakistan. The demographic shift caused an initial bitterness between the two countries that was further intensified by each country’s accession of a portion of the princely states in the region. Nearly all of these 562 widely scattered polities joined either India or Pakistan; however, the Muslim princes of Hyderābād and Jūnāgadh and the Hindu ruler of Kashmīr chose not to join either country.

On August 14 and 15, 1947, these three princely states had become technically independent. But when the Muslim ruler of Jūnāgadh, with its predominantly Hindu population, joined Pakistan a month later, India annexed his territory. In September 1948 India used force of arms to annex Hyderābād (now part of Andhra Pradesh state, in central India), which had a mostly Hindu population. The Hindu ruler of Kashmīr, whose subjects were 85 percent Muslim, decided to join India. Pakistan, however, questioned his right to do so, and a war broke out between India and Pakistan. Although the United Nations (UN) subsequently resolved that a plebiscite be held under UN auspices to determine the future of Kashmīr, India continued to occupy about two-thirds of the state and refused to hold a plebiscite. Pakistan controlled the remaining portion as Azad (Free) Kashmīr, an autonomous region, and the Northern Areas, federally administered. This deadlock, which still persists, has intensified suspicion and antagonism between the two countries.

C -Early Governments and the Constitution of 1956
The first government of Pakistan was headed by Prime Minister Liaquat Ali Khan and it chose the seaport of Karāchi as its capital. Jinnah, considered the founder of Pakistan and hailed as the Quaid-i-Azam (Great Leader), became head of state as governor-general. The government faced many challenges in setting up new economic, judicial, and political structures. It endeavored to organize the bureaucracy and the armed forces, resettle the Mohajirs (Muslim refugees from India), and establish the distribution and balance of power in the provincial and central governments. Undermining these efforts were provincial politicians who often defied the authority of the central government, and frequent communal riots. Before the government could surmount these difficulties, Jinnah died in September 1948.

In foreign policy, Liaquat established friendly relations with the United States when he visited President Harry S. Truman in 1950. Pakistan’s early foreign policy was one of nonalignment, with no formal commitment to either the United States or the Union of Soviet Socialist Republics (USSR), the two major adversaries in the Cold War. In 1953, however, Pakistan aligned itself with the United States and accepted military and economic assistance.
Liaquat was assassinated in 1951. Khwaja Nazimuddin, an East Pakistani who had succeeded Jinnah as governor-general, became prime minister. Ghulam Muhammad became governor-general. Nazimuddin attempted to limit the powers of the governor-general through amendments to the Government of India Act of 1935, under which Pakistan was governed pending the adoption of a constitution. Ghulam Muhammad dismissed Nazimuddin and replaced him with Muhammad Ali Bogra, Pakistan’s ambassador to the United States, who subsequently was elected president of the Muslim League.

In the 1954 provincial elections in East Pakistan, the Muslim League was routed by the United Front coalition, which supported provincial autonomy. The coalition was dominated by the Awami League. However, Ghulam Muhammad imposed governor’s rule in the province, preventing the United Front from taking power in the provincial legislature. After the constituent assembly attempted to curb the governor-general’s power, Ghulam Muhammad declared a state of emergency and dissolved the assembly. A new constituent assembly was indirectly elected in mid-1955 by the various provincial legislatures. The Muslim League, although still the largest party, was no longer dominant as more parties, including those of the United Front coalition, gained representation. Bogra, who had little support in the new assembly, was replaced by Chaudhri Muhammad Ali, a former civil servant in West Pakistan and a member of the Muslim League. At the same time, General Iskander Mirza became governor-general.

The new constituent assembly enacted a bill, which became effective in October 1955, integrating the four West Pakistani provinces into one political and administrative unit, known as the One Unit. This change was designed to give West Pakistan parity with the more populous East Pakistan in the national legislature. The assembly also produced Pakistan’s first constitution, which was adopted on March 2, 1956. It provided for a unicameral (single-chamber) National Assembly with 300 seats, evenly divided between East and West Pakistan. It also officially designated Pakistan an Islamic republic. According to its provisions, Mirza’s title changed from governor-general to president.

D -Unstable Parliamentary Democracy
The new charter notwithstanding, political instability continued because no stable majority party emerged in the National Assembly. Prime Minister Ali remained in office only until September 1956, when he was unable to retain his majority in the National Assembly and was succeeded by Hussain Shaheed Suhrawardy, founder of the Awami League of East Pakistan. He formed a coalition cabinet that included the Awami League and the Republican Party of the West Wing, a new party that was formed by dissident members of the Muslim League. However, President Mirza forced Suhrawardy to resign after he discovered that the prime minister was planning to support Firoz Khan Noon, leader of the Republican Party, for the presidency in the country’s first general elections, scheduled for January 1959. The succeeding coalition government, headed by Ismail Ibrahim Chundrigar of the Muslim League, lasted only two months before it was replaced by a Republican Party cabinet under Noon.

President Mirza, realizing he had no chance of being reelected president and openly dissatisfied with parliamentary democracy, proclaimed martial law on October 7, 1958. He dismissed Noon’s government, dissolved the National Assembly, and canceled the scheduled general elections. Mirza was supported by General Muhammad Ayub Khan, commander in chief of the army, who was named chief martial-law administrator. Twenty days later Ayub forced the president to resign and assumed the presidency himself.

E -The Ayub Years
President Ayub ruled Pakistan almost absolutely for a little more than ten years. Although his regime made some notable achievements, it did not eliminate the basic problems of Pakistani society. Ayub’s regime increased developmental funds to East Pakistan more than threefold. This had a noticeable effect on the economy of the province, but the disparity between the two wings of Pakistan was not eliminated. His regime also initiated land reforms designed to reduce the political power of the landed aristocracy. Ayub also promulgated a progressive Islamic law, the Muslim Family Laws Ordinance of 1961, imposing restrictions on polygamy and divorce and reinforcing the inheritance rights of women and minors.

In 1959, soon after taking office, Ayub ordered the planning and construction of a new national capital, to replace Karāchi. The chosen location of the new capital in the province of Punjab was close to the military headquarters of Rāwalpindi, which served as an interim capital. Islāmābād officially became the new capital in 1967, although construction continued into the 1970s.
Perhaps the most pervasive of Ayub’s changes was his introduction of a new political system, known as the Basic Democracies, in 1959. It created a four-tiered system of mostly indirect representation in government, from the local to the national level, allowing communication between local communities and the highly centralized national government. Each tier was assigned certain responsibilities in local administration of agricultural and community development, such as maintenance of elementary schools, public roads, and bridges. All the councils at the tehsil (subdistrict), zilla (district), and division levels were indirectly elected. The lowest tier, on the village level, consisted of union councils. Members of the union councils were known as Basic Democrats and were the only members of any tier who were directly elected.

A new constitution promulgated by Ayub in 1962 ended the period of martial law. The new, 156-member National Assembly was elected that year by an electoral college of 120,000 Basic Democrats from the union councils. After the legislative elections political parties were again legalized. Ayub created the Pakistan Muslim League (PML) as the official government party. The presidential election of January 1965, also determined by electoral college rather than direct vote, resulted in a victory for Ayub, although opposition parties were allowed to participate.

Ayub was skillful in maintaining cordial relations with the United States, stimulating substantial economic and military aid to Pakistan. This relationship deteriorated in 1965, when another war with India broke out over Kashmīr. The United States then suspended military and economic aid to both countries. The USSR intervened to mediate the conflict, inviting Ayub and Prime Minister Lal Bahadur Shastri of India to meet in Toshkent (Tashkent). By the terms of the so-called Toshkent Agreement of January 1966, the two countries withdrew their forces to prewar positions and restored diplomatic, economic, and trade relations. Exchange programs were initiated, and the flow of capital goods to Pakistan increased greatly.

The Toshkent Agreement and the Kashmīr war, however, generated frustration among the people and resentment against President Ayub. Foreign Minister Zulfikar Ali Bhutto, who opposed Pakistan’s capitulation, resigned his position and founded the Pakistan People’s Party (PPP) in opposition to the Ayub regime. Ayub tried unsuccessfully to make amends, and amid mounting public protests he declared martial law and resigned in March 1969. Instead of transferring power to the speaker of the National Assembly, as the constitution dictated, he handed it over to the commander in chief of the army, General Agha Muhammad Yahya Khan, who was the designated martial-law administrator. Yahya then assumed the presidency.

F -Yahya Regime
In an attempt to make his martial-law regime more acceptable, Yahya dismissed almost 300 senior civil servants and identified 32 families that were said to control about half of Pakistan’s gross national product. To curb their power Yahya issued an ordinance against monopolies and restrictive trade practices in 1970. He also committed to the return of constitutional government and announced the country would hold its first general election on the basis of universal adult franchise in late 1970.

Yahya determined that representation in the National Assembly would be based on population. In July 1970 he abolished the One Unit, thereby restoring the original four provinces in West Pakistan. As a result, East Pakistan emerged as the largest province of the country, while in West Pakistan the province of Punjab emerged as the dominant province. East Pakistan was allocated 162 seats in the 300-seat National Assembly, and the provinces of West Pakistan were allocated a total of 138.

G -Civil War
The election campaign intensified divisions between East and West Pakistan. A challenge to Pakistan’s unity emerged in East Pakistan when Sheikh Mujibur Rahman (“Mujib”), leader of the Awami League, insisted on a federation under which East Pakistan would be virtually independent. He envisaged a federal government that would deal with defense and foreign affairs only; even the currencies would be different, although freely convertible.

Mujib’s program had great appeal for many East Pakistanis, and in the December 1970 election called by Yahya, he won by a landslide in East Pakistan, capturing 160 seats in the National Assembly. Bhutto’s Pakistan People’s Party (PPP) emerged as the largest party in West Pakistan, capturing 81 seats (predominantly in Punjab and Sind). This gave the Awami League an absolute majority in the National Assembly, a turn of events that was considered unacceptable by political interests in West Pakistan because of the divided political climate of the country. The Awami League adopted an uncompromising stance, however, and negotiations between the various sides became deadlocked.

Suspecting Mujib of secessionist politics, Yahya in March 1971 postponed indefinitely the convening of the National Assembly. Mujib in return accused Yahya of collusion with Bhutto and established a virtually independent government in East Pakistan. Yahya opened negotiations with Mujib in Dhaka in mid-March, but the effort soon failed. Meanwhile Pakistan’s army went into action against Mujib’s civilian followers, who demanded that East Pakistan become independent as the nation of Bangladesh.

There were many casualties during the ensuing military operations in East Pakistan, as the Pakistani army attacked the poorly armed population. India claimed that nearly 10 million Bengali refugees crossed its borders, and stories of West Pakistani atrocities abounded. The Awami League leaders took refuge in Calcutta (now Kolkata) and established a government in exile. India finally intervened on December 3, 1971, and the Pakistani army surrendered 13 days later. East Pakistan declared its independence as Bangladesh.

Yahya resigned, and on December 20 Bhutto was inaugurated as president and chief martial law administrator of a truncated Pakistan. Mujib became the first prime minister of Bangladesh in January 1972. When the Commonwealth of Nations admitted Bangladesh later that year, Pakistan withdrew its membership, not to return until 1989. However, the Bhutto government gave diplomatic recognition to Bangladesh in 1974.

H -The Bhutto Government
Under Bhutto’s leadership Pakistan began to rearrange its national life. Bhutto nationalized the basic industries, insurance companies, domestically owned banks, and schools and colleges. He also instituted land reforms that benefited tenants and middle-class farmers. He removed the armed forces from the process of decision making, but to placate the generals he allocated about 6 percent of the gross national product to defense. In July 1972 Bhutto negotiated the Simla Agreement, which confirmed a line of control dividing Kashmīr and prompted the withdrawal of Indian troops from Pakistani territory.

In April 1972 Bhutto lifted martial law and convened the National Assembly, which consisted of members elected from West Pakistan in 1970. After much political debate, the legislature drafted the country’s third constitution, which was promulgated on August 14, 1973. It changed the National Assembly into a two-chamber legislature, with a Senate as the upper house and a National Assembly as the lower house. It designated the prime minister as the most powerful government official, but it also set up a formal parliamentary system in which the executive was responsible to the legislature. Bhutto became prime minister, and Fazal Elahi Chaudry replaced him as president.

Although discontented, the military grudgingly accepted the supremacy of the civilian leadership. Bhutto embarked on ambitious nationalization programs and land reforms, which he called “Islamic socialism.” His reforms achieved some success but earned him the enmity of the entrepreneurial and capitalist class. In addition, religious leaders considered them to be un-Islamic. Unable to deal constructively with the opposition, he became heavy-handed in his rule. In the general elections of 1977, nine opposition parties united in the Pakistan National Alliance (PNA) to run against Bhutto’s PPP. Losing in three of the four provinces, the PNA alleged that Bhutto had rigged the vote. The PNA boycotted the provincial elections a few days later and organized demonstrations throughout the country that lasted for six weeks.

I -Zia Regime
The PPP and PNA leadership proved incapable of resolving the deadlock, and the army chief of staff, General Muhammad Zia ul-Haq, staged a coup on July 5, 1977, and imposed another martial-law regime. Bhutto was tried for authorizing the murder of a political opponent and found guilty; he was hanged on April 4, 1979. The PPP was reorganized under the leadership of his daughter, Benazir Bhutto.

Zia formally assumed the presidency in 1978 and embarked on an Islamization program. Through various ordinances between 1978 and 1985, he instituted the Islamization of Pakistan’s legal and economic systems and social order. In 1979 a federal Sharia (Islamic law) court was established to exercise Islamic judicial review. Other ordinances established interest-free banking and provided maximum penalties for adultery, defamation, theft, and consumption of alcohol.

On March 24, 1981, Zia issued a Provisional Constitutional Order that served as a substitute for the suspended 1973 constitution. The order provided for the formation of a Federal Advisory Council (Majlis-e-Shoora) to take the place of the National Assembly. In early 1982 Zia appointed the 228 members of the new council. This effectively restricted the political parties, which already had been constrained by the banning of political activity, from organizing resistance to the Zia regime through the election process.

The Soviet intervention in Afghanistan in December 1979 heightened Pakistan’s insecurity and changed the fortunes of General Zia’s military regime. Afghan refugees began to pour into Pakistan. After about a year, the United States responded to the crisis. In September 1981 Zia accepted a six-year economic and military aid package worth $3.2 billion from the United States. (The United States approved a second aid package worth $4.0 billion in 1986 but then suspended its disbursement in 1989 due to Pakistan’s nuclear-weapons program.) After a referendum in December 1984 endorsed Zia’s Islamization policies and the extension of his presidency until 1990, Zia permitted elections for parliament in February 1985. A civilian cabinet took office in April, and martial law ended in December. Zia was dissatisfied, however, and in May 1988 he dissolved the government and ordered new elections. Three months later he was killed in an airplane crash possibly caused by sabotage, and a caretaker regime took power until elections could be held.

J -Shifting Civilian Governments
Benazir Bhutto became prime minister after her PPP won the general elections in November 1988. She was the first woman to head a modern Islamic state. A civil servant, Ghulam Ishaq Khan, was appointed president. In August 1990 he dismissed Bhutto’s government, charging misconduct, and declared a state of emergency. Bhutto and the PPP lost the October elections after she was arrested for corruption and abuse of power.

The new prime minister, Nawaz Sharif, head of the Islamic Democratic Alliance (a coalition of Islamic parties including the Pakistan Muslim League), introduced a program of privatizing state enterprises and encouraging foreign investment. Fulfilling Sharif’s election promise to make Sharia (Islamic law) the supreme law of Pakistan, the national legislature passed an amended Shariat Bill in 1991. Sharif also promised to ease continuing tensions with India over Kashmīr. The charges against Bhutto were resolved, and she returned to lead the opposition. In early 1993 Sharif was appointed the leader of the Pakistan Muslim League.

In April 1993 Ishaq Khan once again used his presidential power, this time to dismiss Sharif and to dissolve parliament. However, Sharif appealed to the Supreme Court of Pakistan, and in May the court stated that Khan’s actions were unconstitutional, and the court reinstated Sharif as prime minister. Sharif and Khan subsequently became embroiled in a power struggle that paralyzed the Pakistani government. In an agreement designed to end the stalemate, Sharif and Khan resigned together in July 1993, and elections were held in October of that year. Bhutto’s PPP won a plurality in the parliamentary elections, and Bhutto was again named prime minister.

In 1996 Bhutto’s government was dismissed by President Farooq Leghari amid allegations of corruption. New elections in February 1997 brought Nawaz Sharif back to power in a clear victory for the Pakistan Muslim League. One of Sharif’s first actions as prime minister was to lead the National Assembly in passing a constitutional amendment stripping the president of the authority to dismiss parliament. The action triggered a power struggle between Sharif, Leghari, and Supreme Court Chief Justice Sajjad Ali Shah. When the military threw its support behind Sharif, Leghari resigned and Shah was removed. Sharif’s nominee, Rafiq Tarar, was then elected president.
Pakistan was beset by domestic unrest beginning in the mid-1990s. Violence between rival political, religious, and ethnic groups erupted frequently in Sind Province, particularly in Karāchi. Federal rule was imposed on the province in late 1998 due to increasing violence.

K -Relations with India
Relations between India and Pakistan became more tense beginning in the early 1990s. Diplomatic talks between the two countries broke down in January 1994 over the disputed Kashmīr region. In February Bhutto organized a nationwide strike to show support for the militant Muslim rebels in Indian Kashmīr involved in sporadic fighting against the Indian army. She also announced that Pakistan would continue with its nuclear weapons development program, raising concerns that a nuclear arms race could start between Pakistan and India, which has had nuclear weapons since the 1970s. In January 1996, despite some controversy, the United States lifted economic and some military sanctions imposed against Pakistan since 1990. The sanctions, imposed to protest Pakistan’s nuclear weapons program, were lifted to allow U.S. companies to fulfill contracts with Pakistan and to help foster diplomatic relations between the two countries.

In early 1997 Sharif resumed talks with India over the Kashmīr region; however, negotiations quickly broke down when armed hostilities erupted again. Tensions escalated further in 1998, when India conducted several nuclear tests. Pakistan responded with its own tests, detonating nuclear weapons for the first time in its history. The Pakistani government then declared a state of emergency, invoking constitutional provisions that operate when Pakistan’s security comes under “threat of external aggression.” Many foreign countries, including the United States, imposed economic sanctions against both India and Pakistan for exploding nuclear devices. In the months following the explosions, the leaders of Pakistan and India placed a moratorium on further nuclear testing, and the United States initiated negotiations between the two countries aimed at reducing tensions and circumventing an arms race in the region.

In early 1999 Sharif and Indian prime minister Atal Bihari Vajpayee signed the Lahore Declaration, which articulated a commitment to work toward improved relations. However, in April fears of a nuclear arms race revived when both countries tested medium-range missiles capable of carrying nuclear warheads. Furthermore, in May 1999 Kashmīri separatists, widely believed to be backed by Pakistan, seized Indian-controlled territory near Kargil in the disputed Kashmīr region. Fighting between Indian forces and the separatists raged until July, when Sharif agreed to secure the withdrawal of the separatists and India suspended its military campaign. Tensions again escalated over the disputed region following several armed attacks on Indian targets by Kashmīri separatists in late 2001 and early 2002. By mid-2002 India and Pakistan had amassed an estimated 1 million troops along their shared border, prompting mediation efforts by the international community to improve relations between the two nuclear powers.

L -Musharraf Takes Power
The Pakistani military accused Sharif of giving in too easily to pressure from India and for pinning the blame for the Kargil attack on army chief Pervez Musharraf. In October 1999 Sharif tried to dismiss Musharraf from his position. He attempted to prevent Musharraf’s return to Pakistan from abroad by refusing to let his airplane land. The commercial airplane was forced to circle the Karāchi airport until army forces loyal to Musharraf took over the airport. Army forces also seized control of the government in a bloodless coup that lasted less than three hours.

Musharraf declared himself the chief executive of Pakistan, suspended the constitution, and dissolved the legislature. He appointed an eight-member National Security Council to function as the country’s supreme governing body. Many Pakistanis, already chafing under Sharif’s increasingly autocratic rule and suffering from a sagging Pakistani economy after ten years of government excesses and corruption, welcomed the coup. Sharif was arrested, and in April 2000 he was convicted of abuse of power and other charges and sentenced to life imprisonment; his sentence was subsequently commuted and he was allowed to live in exile in Saudi Arabia. Meanwhile, the Supreme Court of Pakistan set a deadline of October 2002 for holding national elections to restore civilian rule. The Commonwealth of Nations, however, formally suspended Pakistan’s membership because the coup ousted a civilian government.

After assuming power, Musharraf’s military government adopted a reformist posture. It identified economic reform as the most urgent measure needed to restore the confidence of foreign and local investors. As part of this strategy, Musharraf initiated an ambitious program based on accountability, improved governance, and widening of the tax net. However, in the wake of the coup new international sanctions were imposed to oppose the military regime. Donor agencies such as the International Monetary Fund (IMF) were unwilling to provide new loans or reschedule Pakistan’s foreign debt.

L1 -Pakistan Allies with United States
In 2001 Pakistan established itself as a vital U.S. ally and key regional player after the September 11 terrorist attacks in the United States. Pakistan became a frontline state of high strategic importance as the U.S.-led war on terrorism unfolded in neighboring Afghanistan. Pakistan had been an ally of the Taliban, which had established a fundamentalist Islamic regime in Afghanistan in 1996. The Taliban was accused of harboring the suspected mastermind of the terrorist attacks, Osama bin Laden. The Taliban and bin Laden’s international terrorist network, al-Qaeda, became the target of U.S.-led air strikes in Afghanistan that began on October 7. The Musharraf government agreed to provide logistical support and use of Pakistan’s airspace for the offensive, and to share military intelligence to fight global terrorism. Formally breaking with the Taliban, Pakistan withdrew all of its diplomats from Afghanistan and officially closed its shared border. On September 22, meanwhile, the United States lifted most of the economic sanctions it had imposed after Pakistan exploded nuclear devices in 1998, brightening prospects for Pakistan’s economy.

L2 -Constitutional Amendments and Elections
Musharraf pledged to hold provincial and parliamentary elections in October 2002. In a bid to secure his position as president, a title he had adopted in 2001, Musharraf called a referendum in April 2002 on extending his presidency for five years. The referendum returned a majority of votes in favor of the proposal, although low voter turnout, loose voting rules, and the absence of poll monitors tainted the results. In addition, political parties denounced the referendum because under the constitution, the president is to be selected by members of the national and provincial legislatures.

In August Musharraf decreed 29 amendments to Pakistan’s constitution, granting himself sweeping new powers. The amendments allow him to dissolve the parliament, force the resignation of the prime minister, appoint military chiefs and Supreme Court justices, and chair a new National Security Council. The council is to include top military leaders and provide oversight of elected representatives, thereby giving the armed forces a formal role in governing the country. Prior to the October elections, Musharraf banned former prime ministers Sharif and Bhutto, who both live in exile, from running as candidates in the election. Musharraf also imposed new requirements for candidates, allowing only individuals with college degrees and no outstanding loans to participate.

In the October elections, no single party or coalition of parties won a majority of seats in the National Assembly (lower house). The Pakistan Muslim League (Quaid-e-Azam), a new PML faction formed prior to the elections as a pro-Musharraf party, won the largest number of seats. However, pro-democracy opposition parties and hardline Islamic parties also made a strong showing in the election. The second largest number of seats went to Bhutto’s Pakistan People’s Party (PPP), which led the 15-party Alliance for the Restoration of Democracy. An alliance of six Islamic parties, the Muthida Majlis-e-Amal (United Council of Action), finished in third place, winning the largest number of seats of any religious grouping in Pakistan’s history. The Pakistan Muslim League (Nawaz), Sharif’s PML faction, finished in a distant fourth place.
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Post Indus Valley Civilization

Indus Valley Civilization


I -INTRODUCTION
Indus Valley Civilization (2500?-1700 BC), earliest known civilization of South Asia, corresponding to the Bronze Age cultures of ancient Egypt, Mesopotamia, and Crete (Kríti). The remains of settlements belonging to this culture have been found throughout the Indus River valley in Pakistan, westward along the coast to the Iranian border, in India's northwestern states as Far East as New Delhi, and on the Oxus River in northern Afghanistan. The Indus Valley civilization encompasses one of the largest geographical areas covered by a single Bronze Age culture.

II CHARACTERISTICS
Excavated settlements reveal blocks of mud-brick buildings separated by streets, and large public buildings dominate the cities, such as Mohenjo-Daro and Harappā. These buildings were at one time identified as colleges, temples, granaries, and palaces, but later research has not confirmed such interpretations. The cities are usually divided into two distinctive groups of buildings, one of which may be enclosed by a wall.

The work of Indus Valley artisans shows a high degree of craft specialization. Characteristic artifacts include a distinctive black-on-red pottery, ceramic toys and figurines, etched carnelian beads, metal (bronze, silver, and gold) ornaments and tools, and stamp seals with an undecipherable script. Unfortunately, the nature of the social organization in this complex culture still evades complete interpretation.

Sometime after 2000 BC, complex ecological changes occurred in the Indus Valley area, forcing abandonment of many settlements and altering the basic characteristics of the civilization. Late Indus Valley culture is known mainly from excavated small farming villages. Artifacts associated with these sites are stylistically similar to earlier types but show more regional variation.

III -HISTORY OF EXCAVATIONS
The Indus Valley civilization was first defined by the British archaeologist Sir John Marshall's diggings at Mohenjo-Daro and M. S. Vat's excavations at Harappā (both in what is now Pakistan) in the 1920s, and it is sometimes called Harappān civilization after the latter site. In 1946 the British archaeologist Sir Mortimer Wheeler, excavating at Harappā, located stylistically different pottery in the earliest occupied areas.

Subsequent discoveries at nearby Kot Diji established that this early pottery at Harappā belonged to the early Bronze Age Kot Diji culture. Since 1960 Indian, Pakistani, and Western scholars have defined several additional early Bronze Age cultures at Goth Āmri, Sothi, Gumla, and other sites in Pakistan, each of which has some traits in common and contributed to the formation of the Indus Valley civilization.
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Post Parliamentary History Of Pakistan

The Muslims of India had, since the middle of nineteen century, begun the struggle for a separate homeland on the basis of the two Nation theory. The British rulers realized that the Hindus and Muslims of India remained two separate and distinct nations and socio-cultural entities. The British rulers were left with no option but to eventually accept the demand of the Muslims of India.

On 3rd June1947, Lord Mountbatten, the last Viceroy of India, called the conference of all the leaders of the Sub-continent and communicated to them his Government's Plan for the transfer of power. At that time, a notification was issued in the Gazette of India, published on 26th July 1947 in which the first Constituent Assembly of Pakistan was given shape with 69 Members (later on the membership was increased to 79), including one female Member.

The State of Pakistan was created under the Independence Act of 1947. The Act made the existing Constituent Assemblies, the dominion legislatures. These Assemblies were allowed to exercise all the powers, which were formerly exercised by the Central Legislature, in addition to the powers regarding the framing of a new Constitution, prior to which all territories were to be governed in accordance with the Government of India Act, 1935.

The first session of the first Constituent Assembly of Pakistan was held on 10th August 1947 at Sindh Assembly Building Karachi. On 11th August 1947 Quaid-i-Azam Muhammad Ali Jinnah was elected unanimously as the President of the Constituent Assembly of Pakistan and the Assembly formally approved the National Flag.

On 12th August 1947, a resolution was approved regarding officially addressing Mr. Muhammad Ali Jinnah as "Quaid-i-Azam Muhammad Ali Jinnah". On the same day, a special committee called the "Committee on Fundamental Rights of Citizens and Minorities of Pakistan" was appointed to look into and advise the Assembly on matters relating to fundamental rights of the citizens, particularly the minorities, with the aim to legislate on these issues appropriately. On 14th August 1947, the Transfer of Power took place. Lord Mountbatten, Governor General of India, addressed the Constituent Assembly of Pakistan. The Quaid gave a reply to the address in the House, on which the principles of the State of Pakistan were laid. On 15th August 1947, Quaid-i-Azam was sworn in as the first Governor General of Pakistan. Mian Sir Abdur Rashid, Chief Justice of Pakistan, administered oath of office from him. The Quaid remained in this position till his death i.e.11th September 1948.

The foremost task before the first Constituent Assembly is of framing the Constitution for the nation. On 7th March 1949, the Objectives Resolution, which now serves as the grund norm of Pakistan, was introduced by the first Prime Minister of Pakistan Nawabzada Liaquat Ali Khan, and later adopted by the Constituent Assembly on 12th March 1949. On the same day, a Basic Principles Committee comprising of 24 Members was formed to prepare a draft Constitution on the basis of the Objectives Resolution. On 16th October 1951, Prime Minister Nawabzada Liaquat Ali Khan, mover of the Objective Resolution, was assassinated and Khawaja Nazimuddin took over as the Prime Minister on 17th October 1951.

The final draft of the Constitution was prepared in 1954. By that time, Muhammad Ali Bogra had taken over as the Prime Minister. However, just before the draft could be placed in the House for approval, the Assembly was dissolved by the then Governor General Ghulam Muhammad on 24th October1954. The Prime Minister was, however, not dismissed and was asked to run the administration, with a reconstituted Cabinet, until such time as the elections were held.

Maulvi Tamizuddin, President of the Assembly, challenged the dissolution in the Sindh Chief Court, and won the case. The Government in return, went to the Federal Court, where the famous judgment was given by the then Chief Justice Muhammad Munir, according to which Maulvi Tamizuddin lost the case.

The second Constituent Assembly of Pakistan was created on 28th May 1955 under Governor General's Order No.12 of 1955. The Electoral College for this Assembly was the Provincial Assemblies of respective Provinces. The strength of this Assembly was 80 Members, half each from East Pakistan and West Pakistan. One of the major decisions taken by this Assembly was the establishment of West Pakistan (One Unit), with the aim to create parity between the two wings (East and West Pakistan). This Assembly also achieved its target by giving the first Constitution to the nation i.e. the Constitution of Pakistan 1956. Choudhary Muhammad Ali was the Prime Minister at that time. The draft of this Constitution was introduced in the Assembly on 9th January 1956 and was passed by the Assembly on 29th February 1956. The assent was given on it by the Governor General on 2nd March 1956. This Constitution was enforced with effect from 23rd March 1956. Under this Constitution, Pakistan became an Islamic Republic, hence 23rd March became our Republic day. It was the same day in 1940 that the historic Pakistan Resolution was adopted at Minto Park, Lahore.

On 5th March 1956, Major General Sikandar Mirza became the first elected President of Pakistan. The 1956 constitution provides for Parliamentary form of government with all the executive powers in the hands of Prime Minister. President was Head of the State and was to be elected by all Members of the National and Provincial Assemblies. He was to hold office for 5 years. The President was to act on the advice of Prime Minister, except where he was empowered to act in his discretion.

Under 1956 Constitution, Parliament was unicameral. Legislative powers vested in the Parliament, which consisted of the President and the National Assembly comprising 300 Members divided equally between East and West Pakistan. In addition to these 300 seats, five seats were reserved for women for each of the two wings, for a period of ten years: thus bringing the total membership of the House to 310.

However, in the absence of any law to control the Political Parties and the problem of floor crossing, political instability perpetually ensued. Although the first general election were scheduled for early 1959, President Sikandar Mirza abrogated the Constitution, dissolved the National and Provincial Assemblies, and declared Martial Law, on 7th October 1958. He appointed General Muhammad Ayub Khan, Commander-in-Chief of the Army, as the Chief Martial Law Administrator.

On 27th October 1958 General Muhammad Ayub Khan took-over as a second President of Pakistan. One of the first major steps taken by General Ayub Khan was the appointment of a Constitution Commission on 17th February 1960. The objective of this commission was to submit proposals, as to how best democracy can be strengthened and molded according to the country’s socio-political environment and Islamic principles of justice. The Commission submitted its report to the government on 29th April 1961. On the basis of this report a new Constitution was framed and given to the nation on 1st March 1962.

General elections under the new Constitution were held on 28th March 1962 and elections to the special seats reserved for women were held on 29th May 1962. The first session of the third National Assembly was held on 8th June 1962 at Ayub Hall, Rawalpindi.

The Constitution of 1962 envisaged a Federal State with Presidential form of government, with National Assembly at the centre and the Provincial Assemblies in the Provinces. The Legislatures, both at centre and in provinces were unicameral. The Federal system had been curtailed by allowing the Provincial Governors to be appointed directly by the President. All executive authority of the Republic of Pakistan, under the Constitution, vested in the office of the President. President appointed his Cabinet members who were directly responsible to him.

The electoral system was made indirect, and the `Basic Democrats', for both wings were declared Electoral College for the purpose of electing the Assemblies and the President. Basic democrats were 80,000 in number (40,000 from each East & West Pakistan). The total membership of the National Assembly was 156, one half of whom were to be elected from East Pakistan and other half from West Pakistan, also three seats were reserved for women from each province. The term of this Assembly was three years. The norm was established that if the President was from West Pakistan, the Speaker was to be from East Pakistan and vice versa. One of the major achievements of this Assembly was the passage of Political Parities Act, 1962.

On 25th March 1969 the second Martial law was imposed and General Agha Muhammad Yahya Khan took-over as the President of Pakistan and Chief Martial Law Administrator (CMLA). He later issued a Legal Framework Order (LFO), under which the first ever general elections were held on 7th December 1970. This was the first Assembly elected on the adult franchise and population basis. It consist of 313 members, 169 from East Pakistan and 144 from West Pakistan including 13 reserved seats for women (6 were from West Pakistan and 7 from East Pakistan). Soon after the elections, due to grave political differences, the Province of East Pakistan seceded from West Pakistan and became Bangladesh. On 20th December 1971 Mr. Zulfiqar Ali Bhutto took over as the President of Pakistan as well as the first civil Chief Martial Law Administrator.

The first session of the National Assembly, due to the delay caused by the separation of East Pakistan, was held on 14thApril 1972 at the State Bank Building, Islamabad, in which all 144 Members from West Pakistan and two from former East Pakistan (Mr. Noor-ul-Amin and Raja Tridev Roy who had chosen to join Pakistan) participated. On 17th April 1972 an Interim Constitution was adopted by the National Assembly, which provided for a Presidential form of Government. Under this Constitution, the National Assembly was not to be dissolved earlier than 14th August 1973. The Interim Constitution dealt in detail with the distribution of powers between the Centre and the Provinces.

The Assembly also formed a Constitution Committee on 17th April 1972 to prepare the first draft for framing a Constitution. The report of the Committee was presented with a draft Constitution on 31st December 1972. It was unanimously passed by the Assembly in its session on 10th April 1973 and was authenticated by the President on 12th April 1973. This Constitution, called the Constitution of the Islamic Republic of Pakistan 1973, was promulgated on 14th August 1973. On the same day, Mr. Zulfiqar Ali Bhutto took oath as the Prime Minister, while Mr. Fazal Illahi Choudhary took oath as the President of Pakistan.

The 1973 Constitution provides for a parliamentary form of government where the executive authority of the state vests with the Prime Minister. The President, according to the Constitution, is at the apex, representing the unity of the Republic.

From 1947 to 1973, the country had a unicameral system of legislature. Under the 1973 Constitution, Pakistan adopted bicameral system at the centre, called “The Parliament”, composing the President, the National Assembly and The Senate. Originally, the general seats of the National Assembly were 200 with additional 10 seats reserved for women, bringing the total strength to 210. The newly created Upper House i.e. the Senate had 63 members. Later in 1985 through a Presidential Order (P.O. No. 14 of 1985), seven seats were added to the general seats and ten to the reserved seats for women in the National Assembly. Ten seats were exclusively reserved for minorities to be filled through separate electorate system. Thus the total strength of the lower house reached to 237 members. Similarly the strength of Senate was also increased from 63 to 87.

Under the 1973 Constitution the National Assembly is elected for five years term, unless sooner dissolved. The seats in National Assembly, unlike the Senate, are allocated to each province and other units of the federation, on the basis of population. The Constitutional provision of 20 special seats for women lapsed in 1990, thus decreased the Assembly strength from 237 to 217. Under the Constitution, elections to the 10 seats reserved for minority were held on separate electorate basis.

Despite the tenure of the Assembly being five years, as prescribed in the Constitution, Mr. Z.A.Bhutto, on 7th January 1977 announced the holding of elections before time. Consequently, on 10th January 1977, he advised the President to dissolve the National Assembly. Elections were held on 7th March 1977. The opposition charged the government with rigging the elections to the National Assembly and thereafter boycotted the Provincial Assemblies elections. Since the opposition had not accepted the National Assembly elections result, they did not take oath. This resulted in severe political crisis and Martial Law was imposed by the then Army Chief, General Muhammad Zia-ul-Haq, on 5th July 1977.

On 24th December 1981, under Presidential Order (P.O.15 of 1981) a Federal Council (Majlis-e-Shoora) was constituted by the President. The President nominated its members. The first session of this Council was held on 11th January 1982. In this way, limited and controlled political activities were resumed, as a result of which general elections were later held for the National and Provincial Assemblies on 25th February 1985, on non-party basis.

On 2nd March 1985, the revival of Constitution Order (P.O.14 of 1985) was issued in which a large number of amendments were made in the Constitution. The first session of the National Assembly was held 20th March 1985. Mr. Muhammad Khan Junejo, was nominated as the Prime Minister of Pakistan by the President (General Zia-ul-Haq). He received vote of confidence on 24th March 1985.

In November 1985, the 8th Constitutional Amendment was adopted by the Parliament. Besides changes in other Articles in the Constitution the significant Article 58(2)(b) was added, according to which the President acquired discretionary powers to dissolve the National Assembly. On 29th May 1988 the President dissolved the Assembly by using the power acquired under Article 58(2)(b).

The General elections for the eighth National Assembly was held on 16th November 1988. The President convened the first session on 30th November 1988. Mr. Miraj Khalid was elected as a Speaker National Assembly on 3rd December 1988. Mohtarma Benazir Bhutto was nominated as Prime Minister of Pakistan and took the oath of the Office on 2nd December 1988. The President, Ghulam Ishaq Khan under Article 58(2) (b) on 6th August 1990, dissolved the Assembly.

The General elections for the ninth National Assembly was held on 24th October 1990. The first session was held on 3rd November 1990. Mr. Gohar Ayub Khan elected as Speaker National Assembly and he took oath on 4th November 1990. Mian Muhammad Nawaz Sharif took oath as Prime Minister of Pakistan on 11th November 1993. The Assembly was dissolved by the then President, Ghulam Ishaq Khan, under Article 58(2)(b) on 18th April 1993. The dissolution of the National Assembly was challenged in the Supreme Court of Pakistan and after hearing the case the Assembly was restored by the apex court on 26th May 1993. The Assembly was dissolved on the advice of the Prime Minister on 18th July 1993.

The elections for tenth National Assembly was held on 6th October 1993. The first session was held on 15th October 1993. Syed Yousaf Raza Gillani took oath of the office of the Speaker National Assembly on 17th October 1993. Mohtarma Benizar Bhutto administered the oath as Prime Minister of Pakistan on October 19th October 1993. The President Farooq Ahmad Khan Laghari dissolved the Assembly on 5th November 1996.

The elections for eleventh National Assembly was held on 3rd February 1997. The first session was held on 15th February 1997. Mr. Illahi Bukhsh Soomro took oath of the office of the Speaker National Assembly on 16th February 1997. Mian Muhammad Nawaz Sharif took oath as Prime Minister of Pakistan and Leader of the House on 17th February 1997. The new Assembly came into power with an overwhelming majority. The Article 58(2)(b) was later on omitted from the Constitution vide 13th Amendment in the Constitution in April 1997.

It may be pertinent to note at this point that while, ostensibly, sixteen amendments have been made in the Constitution so far, the ninth and the eleventh Constitutional Amendments were, however, passed by the Senate alone and fifteenth by the National Assembly alone, hence these amendments lapsed. The fourteenth Amendment in the Constitution empowered a check on floor crossing of legislators.

Chief of Army Staff General Pervaz Musharraf, who was also Chairman Joint Staff Committee, took over the government from Prime Minister Nawaz Sharif and declared himself as Chief Executive through a Proclamation of Emergency, on 12th October 1999. Through Provisional Constitutional Order (PCO) issued on October 14th 1999, he held the Constitution in abeyance, suspended the Senate, National and Provincial Assemblies, Chairman and Deputy Chairman Senate, Speaker, Deputy Speaker National and Provincial Assemblies and dismissed the Federal and Provincial governments. The President Mr. Muhammad Rafiq Tarar was, however allowed to continue in his office. Under PCO (order No. 6) 29th October 1999, (as amended by C.E. Order No.5, 4th July 2001), the National Security Council was established for the purpose to tender advice to the Chief Executive (later on President), on matters relating to Islamic ideology, national security, sovereignty, integrity and solidarity of Pakistan so as to achieve the aims and objective as enshrined in the Objectives Resolution 1949.

Syed Zafar Ali Shah, MNA and Illahi Bukhsh Soomro, Speaker National Assembly, challenged the suspension orders in the Supreme Court. The Court in its judgment on 12th May 2000 validated the military takeover by giving three years time frame to the government, starting from 12th October 1999. The Court in its judgment asked the government to complete its agenda and then hand over powers to the elected government. The court also allowed the military government to bring necessary Constitutional Amendments, provided that those should not change the basic feature of Federal Parliamentary democracy, independence of judiciary and Islamic provisions in the Constitution. The court reserved the right of Judicial Review and power of validity of any act or any action of the government, if challenged, in the light of State necessity.

On 20th June 2001, through a notification (C.E. Order No.1) the Chief Executive assumed the office of the President of Pakistan under President's Succession Order, 2001. On the same day, through another Order (C.E. Order No. 2, 2001), the President converted the orders of suspension of legislative bodies and their presiding officers, in to dissolution.

The elections for twelfth National Assembly was held on 10th October 2002.
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Post Mohammed Ali Jinnah

Jinnah, Mohammed Ali

Jinnah, Mohammed Ali (1876-1948), Indian politician and longtime leader of the Muslim League. Jinnah became the founding father of Pakistan and its first governor-general (1947-1948).

Jinnah was born in Karāchi, a city in what is now Pakistan. (At that time, India and Pakistan were part of a British colony known as British India). Although his family, who were Muslim, came from the state of Rājkot in western India, Jinnah’s father was a prosperous merchant in Karāchi. After being educated in Karāchi and Bombay (now Mumbai), Jinnah studied law at Lincoln’s Inn in London, England, and was admitted to the bar in 1896. After serving briefly as a magistrate in Bombay, he practiced law in that city and soon rose to the top of the profession. He possessed strong advocacy skills and relied on his rhetorical ability to win many cases.

Jinnah’s first important contact with political affairs was in 1906, when he acted as private secretary to Dadabhai Naoroji, president of the Indian National Congress, a political organization that was working for Indian autonomy from British rule. In 1913 Jinnah joined the Muslim League, formed to protect Muslim interests against India’s Hindu majority, though at the time he still hoped for accord between the two groups. In 1916 he was elected president of the Muslim League and in 1919 became the representative of Bombay Muslims in the Imperial Legislative Council, a national legislative body with limited authority under the British colonial government. In the same year, however, the government enacted the Rowlatt Acts, which gave the Indian colonial authorities emergency powers to suppress so-called revolutionary activities. Jinnah, a staunch nationalist, resigned from the council in protest.

In 1920 the Indian National Congress launched the non cooperation movement, a mass campaign to boycott all aspects of British rule in India. Jinnah disagreed profoundly with the movement and resigned from the Congress. Jinnah advocated a moderate approach of cooperation with the British and gradual transfer of power. He continued to believe in the possibility of Hindu-Muslim unity, and worked strenuously toward that end in his second and third terms of office as president of the league. The differences between the Congress and the Muslim League were profound.

Moreover, there was a serious personality clash between Jinnah and Mohandas Gandhi, the leader of the Congress. These differences emerged clearly in the Round Table Conference of 1930, where Indians and British members of parliament met to discuss India’s political future. Jinnah’s frustration at the impossibility of settlement led him to suspend his political activities for four years, during which time he practiced law in England. In 1934 he returned to India on a visit to preside over a Muslim League session and decided that he must remain permanently in India to look after Muslim interests.

The Government of India Act of 1935 transferred considerable power to Indian provincial governments, and in the general elections of 1937 the Congress won a majority in 7 of 11 provinces. The Congress refused to form coalition governments with the Muslim League as Jinnah had proposed. As a result, tensions between Hindus and Muslims grew rapidly. In Hindu-majority provinces, many Muslims felt they were unfairly treated, and at one point Jinnah demanded the appointment of a royal commission to inquire into their grievances. Most Muslims concluded that no legislative weighting or other safeguards could protect them in a united India, where the Hindus would be an overwhelming majority.

In March 1940 Jinnah presided over a Muslim League session at Lahore, where the first official demand was made for the partition of India and the creation of the state of Pakistan, in which Muslims would be a majority. During three decades of political life, Jinnah had believed in the possibility of Hindu-Muslim unity, and it was with the utmost reluctance that he came to the view that partition was essential.

Having reached this conclusion, however, Jinnah never swerved from it. His tenacity through constitutional discussions between the league, the Congress, and the British government in 1942, 1945, and 1946 made partition certain. During these years Jinnah came to be known as Quaid-i-Azam, or “Great Leader.” When Pakistan was created on August 14, 1947, he became its first governor-general, and the title of Quaid-i-Azam was officially bestowed on him by a resolution of the first constituent assembly. Jinnah died of tuberculosis in Karāchi in 1948.
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Default Economic Survey of Pakistan 2005-06

Economic Survey of Pakistan 2005-06: executive summary


The following is the executive summary of the Economic Survey of Pakistan 2005-06.

Pakistan’s economy has delivered yet another year of solid economic growth in 2005-06 in the midst of an extraordinary surge in oil prices and devastating earthquake of October 8, 2005 causing widespread damages. Pakistani corporates and consumers continue to be the bright spot.

Consumer spending remained buoyant and investors remained upbeat on the strength and sustainability of the current growth momentum, despite higher energy prices and natural calamities. With economic growth at 6.6 per cent in 2005-06, Pakistan’s economy has grown at an average rate of almost seven per cent per annum during the last four years (2002/03-2005/06) and over 7.5 per cent in the last three years (2003/04–2005/06), thus positioning itself as one of the fastest growing economies of the Asian region. The growth momentum that Pakistan sustained for the last four years is underpinned by dynamism in industry, agriculture and services, and the emergence of a new investment cycle supported by strong credit growth.

The pre-requisites for a sustained economic growth appear to have gained firm footing during the last four years. The outgoing fiscal year (2005-06) has been an extraordinary year for the economy of Pakistan. At the very onset of the year the economy faced headwinds from rising oil prices, hovering around $70–75 per barrel and putting severe strains on the country’s trade balance on the one hand and budget on the other, and massive earthquake of October 8, 2005 causing extensive damage to property, infrastructure, school, hospital, etc., and loss of over 70,000 human lives. The rescue, relief and reconstruction of earthquake affected areas also put budget under severe stress.

Pakistan’s economy has proved itself as remarkably resilient in the face of shocks of extraordinary proportions. Growth has remained buoyant. Real GDP grew strongly at 6.6 per cent in 2005-06 as against the revised estimates of 8.6 per cent last year and 7.0 per cent growth target for the year. Key drivers of this year’s growth have been service sectors and industry. Large-scale manufacturing grew by 9.0 per cent as against 15.6 per cent of last year and 14.5 per cent target for the year, exhibiting signs of moderation on account of higher capacity utilization on the one hand and strong base effect along with several other factors on the other hand. The services sector continued to perform strongly at 8.8 per cent. Construction too continued to perform strong showing, partly helped by activity in private housing market, spending on physical infrastructure, and reconstruction activities in earthquake affected areas. Consumer spending remained strong and investment spending gained further traction.

Pakistan’s economy continues to maintain solid pace of expansion since the fiscal year 2002-03 recovery in the economy has been strong, rapid and sustained. During the fiscal year 2005-06, Pakistan’s economic fundamentals have gained further strength. The most important achievements of this year include:

Growth and investment

Pakistan’s economy continued to maintain solid pace of expansion for the fourth year in a row in the fiscal year 2005-06 despite facing headwinds from rising energy prices at $70-75 per barrel and the widespread damage caused by the earthquake of October 8, 2005. The growth momentum that Pakistan sustained for the last four years is underpinned by dynamism in industry, agriculture and services, and the emergence of a new investment cycle supported by strong credit growth.

Real GDP grew by 6.6 per cent in 2005-06 as against 8.6 per cent last year and fell short of the target (7.0 per cent). With economic growth at 6.6 per cent in 2005-06, Pakistan’s economy has grown at an average rate of almost 7.0 per cent per annum during the last four years and over 7.5 per cent in the last three years, thus enabling it to join the exclusive club of the fastest growing economies of the Asian region.

Growth of value addition in Commodity Producing Sector (CPS) slowed to 4.3 per cent in 2005-06 as against 9.2 per cent last year. Both the important components of the commodity producing sector namely, agriculture and manufacturing performed less than their targets. Within the CPS, agriculture and manufacturing grew by 2.5 per cent and 8.6 per cent, respectively.

Agriculture and particularly its crop sector could not perform up to the expectation especially major crops registered a 3.6 per cent contraction in growth. Livestock, a major component of agriculture, exhibited strong showing and pulled the overall growth in agriculture to 2.5 per cent as against the target of 4.2 per cent. Livestock has been the only saving grace as far as the performance of agriculture is concerned this year.

Overall manufacturing, accounting for 18.2 per cent of GDP, registered an impressive growth of 8.6 per cent against the target of 12.0 per cent and last year’s achievement of 12.6 per cent. Large-scale manufacturing grew by 9.0 per cent as against 15.6 per cent of last year and 14.5 per cent target for the year, exhibiting signs of moderation on account of higher capacity utilization on the one hand and strong base effect along with several other factors on the other hand. Small-scale manufacturing grew at estimated 9.3 per cent in 2005-06.

The Construction sector continued its strong showing, partly helped by activity in private housing market, spending on physical infrastructure, and reconstruction activities in earthquake affected areas. The construction sector is estimated to grow by 9.2 per cent in 2005-06 as against extraordinary growth of 18.6 per cent last year.

The services sector grew by 8.8 per cent in 2005-06 as against 8.0 per cent of last year. Growth in the services sector in 2005-06 was primarily attributable to strong growth in the finance and insurance sector, better performance of wholesale and retail trade, as well as transport and the communications sector. Finance and insurance sector spearheaded the growth in the services sector and registered stellar growth of 23.0 per cent during the current fiscal year 2005-06 which is slightly lower than 29.7 per cent of last year. Value added in the wholesale and retail trade sector has increased by 9.9 per cent over the previous year, compared to 11.1 per cent growth last year. The transport, storage and communications sector grew by 7.1 per cent compared to 3.5 per cent growth last year. Major contribution towards growth has come from the services sector which has emerged as a new growth power house for some time.

The commodity producing sectors (agriculture and industry) has contributed one-third of the GDP growth and the services sector contributed the remaining two-third to the real GDP growth of 6.6 per cent. The CPS contributed 31.7 per cent or 2.1 percentage point to this year’s growth while the remaining 68 per cent or 4.5 percentage points contribution came from services sector. Within the CPS, agriculture contributed 0.55 percentage points or 8.4 per cent to overall growth while industry contributed 1.54 percentage points or 23.3 per cent. Within services sector wholesale and retail trade has contributed 27.9 per cent or 1.84 percentage points to GDP growth.

Pakistan’s per capita real GDP has risen at a faster pace during the last three years (5.6 per cent per annum on average in rupee terms) leading to a rise in average income of the people. Such increases in real per capita income have led to a sharp increase in consumer spending during the last three years. Per capita income defined as Gross National Product at market price in dollar term divided by the country’s population, grew by an average rate of 13.9 per cent per annum during the last four years -– rising from $579 in 2002-03 to $847 in 2005-06. Per capita income in dollar term registered an increase of 14.1 per cent over last year -– rising from $742 to $847. As opposed to an average annual increase of 1.4 per cent during 2000-03, real private consumption expenditure grew by 13.1 per cent in 2004-05 and further by 8.1 per cent in 2005-06.

Investment

During the fiscal year 2005-06, gross fixed capital formation or domestic fixed investment grew by 30.7 per cent as against a sharp rise of 28.6 per cent last year. Private sector investment grew by 31.6 per cent this year as against a growth of 29.1 per cent last year. Major growth in investment by private sector is witnessed in agriculture (15.3 per cent), manufacturing (14.4 per cent), mining and quarrying (45.5 per cent), construction (9.5 per cent), transport and communication (20.2 per cent), and wholesale and retail trade (424.5 per cent). Public sector investment on the other hand registered massive growth of 46.7 per cent as against a hefty 32.9 per cent increase last year. The growth in domestic investment was largely a public sector phenomenon last year but this year, it was mainly public-private sector partnership driven. Total investment increased from 18.1 per cent of GDP last year to 20.0 per cent of GDP in 2005-06. Fixed investment as percentage of GDP is estimated at 18.4 per cent as against 16.5 per cent last year. Both public sector investment and private sector investment as percentage of GDP have increased to 4.8 per cent and 13.6 per cent, respectively, up from 4.4 per cent and 12.1 per cent last year.

Savings

National savings as percentage of GDP stood at 16.4 per cent in 2005-06 fractionally lower than last year’s level of 16.5 per cent. Domestic savings stood at 14.4 per cent of GDP in 2005-06 slightly lower than 14.5 per cent of GDP last year.

Agriculture

Agriculture is the mainstay of Pakistan’s economy. Nearly twenty-two per cent of total output (GDP) and 44.8 per cent of total employment is generated in agriculture. It also contributes substantially to Pakistan’s exports. Agriculture also contributes to growth as a supplier of raw materials to industry as well as market for industrial products. Furthermore, 44.8 per cent of country’s work force is employed in agriculture, but 65.9 per cent of country’s population living in rural areas is directly or indirectly linked with agriculture for their livelihood. Whatever happens to agriculture is bound to affect not only the country’s growth performance, but to a large segment of the country’s population as well.

Over the last five years, growth in agriculture has witnessed a mixed trend. During the first two years (2000-01 and 2001-02), the country experienced the crippling drought, which badly affected its agriculture and eventually overall growth in agriculture turned negative for these two years. In the preceding years (2002-03 to 2004-05), relatively better availability of irrigation water had positive impact on overall agricultural growth and this sector exhibited a modest to strong recovery.

However, the performance of agriculture during the fiscal year 2005-06 has been weak. Against the target of 4.2 per cent and last year’s achievement of 6.7 per cent, overall agriculture grew by 2.5 per cent in 2005-06, due to a relatively poor performance of major crops and forestry, and weaker one of minor crops and fishery. At the same time, Livestock has been the sole saving grace. Major corps, accounting for 35.2 per cent of value added in agriculture, registered a decline of 3.6 per cent as production of two of the four major crops, namely cotton and sugarcane has been significantly less than last year for a variety of reasons including, excessive rains at the time of sowing, high temperature at the flowering stage, late harvesting of wheat crop, a strong base effect (cotton) and lastly the incidence of frost, damaging sugarcane crop in the month of January, 2006. The production of third major crop, namely wheat, remained more or less at last year’s level at 21.7 million tons thereby registering a meagre growth of 0.4 per cent. The production of rice -– the fourth major crop -– has been the sole major crop which registered an impressive growth of 10.4 per cent, but failed to turn the negative growth in major crops to a positive one.

Minor crops, accounting for 12.3 per cent of agricultural value added, barely managed to register a positive growth of 1.6 per cent in 2005-06 as against a growth of 3.0 per cent last year. The performance of livestock, the single largest sector accounting for almost one–half of agricultural value added, has been impressive as this sector grew by 8.0 per cent on the back of substantial increase in the population of species, milk, etc. The performance of fisheries has been poor as it grew by 1.9 per cent only in 2005-06. Forestry has been registering negative growth for three consecutive years -– registering a negative growth of 9.7 per cent in 2005-06 as against a negative growth of 30.4 per cent.

Pakistan’s agriculture has been suffering, on and off, from a severe shortage of irrigation water in recent years. As against the normal surface water availability at canal heads of 103.5 million-acre feet (MAF), the overall (both for Kharif and Rabi) water availability has been less in the range of 5.9 per cent (2003-04) to 29.4 per cent (2001-02). Relatively speaking, the Rabi season faced more shortage of water than Kharif during these periods. During the current fiscal year (2005-06), the availability of water for Kharif 2005 (for the crops such as rice, sugarcane and cotton) has been 5.5 per cent more than the normal supplies and 19.8 per cent more than last year’s Kharif. Excessive winter rainfalls (January-March 2005) along with the melting of snow on mountains top were responsible for higher than normal availability of water during Kharif 2005. The water availability during the Rabi season (for major crop such as wheat), as on end of March, 2006 was estimated at 30.0 MAF, which was 17.3 per cent less than the normal availability, and 29.8 per cent more than last year’s Rabi.

Amongst major crops, cotton production is estimated at 12.417 million bales for 2005-06 lower by 13 per cent over the last year’s production of 14.265 million bales. Wheat production is estimated at 21.7 million tons in 2005-06 as against 21.612 million tons last year, showing an increase of 0.4 per cent. Rice production has increased by 10.4 per cent in 2005-06 from 5.025 million tons last year to 5.547 million tons in 2005-06. Sugarcane production, however, decreased from 47.244 million tons in 2004-05 to 44.312 million tons in 2005-06, showing a decrease of 6.2 per cent.

As regards the minor crops, the production of chillies and onions increased by 34.8 and 29.0 per cent, respectively, during 2005-06. The production of all the pulses — masoor, moong and mash -– is down by 13.5, 12.6 and 9.8 per cent, respectively, during 2005-06. Lesser production over last year is due to shortfall in area. The production of potato also decreased by 17.9 per cent on account of frost, which affected the potato crop. Agriculture credit disbursement of Rs91.161 billion during July-March, 2005-06 is higher by 23.5 per cent, as compared to Rs73.811 billion over the corresponding period last year. The fertilizer off-take stood at 2,982,000 nutrient tons in July-March 2005-06 or higher by 6.1 per cent, as compared to 2,811, 000 nutrient tons for the corresponding period last year.

Manufacturing, mining and investment policies 2005-06

The overall manufacturing sector continued to maintain its growth momentum with more vigour during the current fiscal year. Overall manufacturing recorded an impressive and broad based growth of 8.6 per cent, against a target of 12.0 per cent and last year’s growth of 12.6 per cent. Large-scale manufacturing registered an impressive growth of 9.0 per cent in the current fiscal year 2005-06 against a target of 14.5 per cent and last year’s achievement of 15.6 per cent.

The main contributors to this impressive growth of 9.0 per cent in July-March 2005-06 over last year are the automobile group (29.76 per cent), engineering goods group (6.46 per cent), non-metallic mineral products (9.49 per cent), leather products (10.91 per cent), chemicals (9.08 per cent), pharmaceuticals (14.83 per cent) and electricals (11.78 per cent). The items that registered positive growth were cotton cloth (0.07 per cent) and cotton yarn (11.16 per cent) in the textile group; cooking oil (17.6 per cent) in the food, beverages and tobacco groups; nitrogenous fertilizer (4.46 per cent), in the chemical group, cement (9.75 per cent) in the non-metallic mineral products group and jeeps and car (29.9 per cent), LCVs (29.3 per cent) and motorcycles/scooters (15.04 per cent) in the automobile group. The individual items exhibiting negative growth include: sugar (2.40 per cent), coke (77.39 per cent), power looms (24.67 per cent) and billets (47.95 per cent).

The output of the mining and quarrying sector grew by 3.8 per cent this year as against the rise of 9.6 per cent last year. The principal minerals which have shown positive growth are: baryte (11.4 per cent), limestone (9.9 per cent), natural gas (4.5 per cent), rock salt (13.2 per cent), sulphur (5.4 per cent) and gypsum (12.6 per cent). While negative growth was exhibited by chromite (6.7 per cent) and magnetite (10.7 per cent).

Foreign direct investment has witnessed an increase of 238.7 per cent in the first ten months (July-April, 2005-06), whereas, net foreign private investment stood at $3,376 million against $1,027 million last year, thereby showing increase of $2,349 million. The increase in foreign private investment is because of the inflow of portfolio investment of $355.8 million as compared to inflow of $135.5 million in the comparable period last year.

The privatisation programme maintained its pace during 2005-06 and succeeded in privatising some high-ticket items despite an inhospitable global environment. By end April 2006, Pakistan completed or approved 160 transactions at gross proceeds of Rs985 billion. This includes 57 transactions for Rs337.908 billion completed during October 1999 to April 2006.

Poverty and income distribution

In Pakistan, the Poverty Reduction Strategy was launched by the government in 2001 in response to the rising trend in poverty during 1990s. Preliminary findings of Pakistan Social and Living Standards Measurement Survey (PSLM 2004-05) on poverty status were released at the end of February 2006, which indicates that the poverty level in Pakistan has been reduced during the last four years. A strong growth (7.5 per cent on average) for three years in a row, with per capita income growing at an average rate of 5.6 per cent; a large inflow of remittances (over $4.0 billion per annum) in recent years, a huge expenditure on poverty-related and social sector program, and many other interventions have made a significant dent to poverty in Pakistan.

As per HIES survey 2004-05, the percentage of the population living below the poverty line is provisionally estimated at 25.4 per cent in 2005, down from 32.1 per cent in 2001. This suggests a decline of 6.7 percentage points in poverty in the last four years. More importantly, the rural poverty has declined more than urban poverty. The provisional estimates show that rural poverty has declined from 39.0 per cent in 2001 to 31.8 per cent in 2005, a decline of 7.2 percentage points. Urban poverty on the other hand is provisionally estimated to have declined from 22.7 per cent in 2001 to 17.2 per cent in 2005, a decline of 5.5 percentage points.

The social sector and poverty related expenditures grew at an average rate of more than 20 per cent per annum during 2001-05. There is nearly a three-fold increase in the projected PRSP expenditure for 2006-07 when compared with the actual expenditures of base year 2001-02. Within the various categories of pro-poor expenditure, human development comes out to be the priority item of the Government with expenditures under this head constituting, on average, more than 50 per cent of all PRSP related expenditures. Further reduction in poverty, however, serves as a major challenge for the government. A clear lesson from the past four years of Pakistan and from other countries’ experience is that sustained growth on a consistent basis is needed to reduce poverty.

Fiscal development

Pakistan has gained further strength on fiscal side. Revenues are buoyant, expenditure is rationalized, fiscal deficit is at sustainable level and revenue deficit has almost been eliminated. Resultantly, Public debt is fast moving towards a sustainable level. Much progress has been made towards fiscal consolidation. The wide-ranging tax and tariff reforms as well as reforms in tax administration have started paying dividends. Tax collection by the Central Board of Revenue (CBR) has picked up. As a result of prudent fiscal management over the last 5 years, the burden of interest payment in domestic budget has declined sharply, thereby, releasing resources for development and social sector programme.

During the five years from 2000-01 to 2005-06, tax collection by the CBR increased by 81.0 per cent. The Central Board of Revenue (CBR) was targeted to collect Rs690 billion but it is most likely to collect Rs710 billion -– Rs20 billion more than the target and 20.6 per cent more than last year. The total expenditure remains more or less stable in a narrow band of 17 to 18.8 per cent of GDP during the last six years. Substantial decline in interest payments from as high as 7.5 per cent of GDP in 1998-99 to 3.1 per cent of GDP in 2005-06, has provided fiscal space to reorient expenditure in favour of development expenditure. Resultantly the share of current expenditure in total expenditure declined from 89 per cent of total expenditure in 1998-99 to 78 per cent in 2005-06. In addition, the share of development expenditure doubled from 11 per cent to 22 per cent in the same period. During the last six years the development expenditure improved from 2.2 per cent of GDP in 2000-01 to 4.2 per cent of GDP in 2005-06. Second largest component of the current expenditure, namely, defence spending remained stagnant at around 3.1 per cent to 3.3 per cent of GDP during the last six years.

Government is achieving the goal of fiscal stabilization without compromising spending on the social sector. Non-defence-non-interest expenditure has improved from 7.8 per cent of GDP in 1999-2000 to 11.8 per cent of GDP in 2005-06. During the last six years the real growth in current expenditure hovered around 3 per cent per annum and pace of growth has slowed down. Total expenditure grew by 3.4 per cent in the first three years (2000-03) but accelerated to 5.6 per cent during the last three years (2003-06). The main contribution is coming from development expenditure which grew by 7.4 per cent per annum in first three years (2000-03) and by 23.8 per cent in recent three years (2003-06).

Total consolidated revenues are targeted at Rs1,095.6 billion in 2005-06 compared to Rs900.0 billion in 2004-05, an increase of 21.7 per cent. This was primarily due to a rise of 22.2 per cent in tax revenue on the back of increases in both federal and provincial tax revenues, which grew by 19.8 per cent and 50.1 per cent, respectively. Non-tax revenue increased by 19.3 per cent in 2005-06 but remained stagnant at 3.8 per cent of GDP.

In 2005-06, Pakistan is likely to face an overall fiscal deficit of Rs261.6 billion or 3.4 per cent of GDP excluding earthquake effect and if we include earthquake related spending worth Rs65.8 billion, the size of the deficit stood at Rs327.3 billion or 4.2 per cent of GDP. This revenue-expenditure gap was financed through external and domestic sources. Out of the gap of Rs327.3 billion, financing from external sources is expected at Rs118.4 billion. The remaining gap of Rs208.9 billion is likely to be financed from domestic sources. Within domestic sources, financing from non-bank sources amounted to Rs22.4 billion while Rs96.7 billion would be contributed by the Banking sources, and Rs90.0 billion is to be financed through privatisation proceeds. The revenue deficit (the difference between total revenue and total current expenditure), a measure of government dis-saving, was at a deficit of 0.7 per cent of GDP in 2004-05 compared to a deficit of 2.2 per cent in 2000-01. It has further progressed towards almost elimination at 0.03 per cent of GDP in 2005-06.

The public debt-to-GDP ratio, which stood at almost 85 per cent in end June 2000, declined substantially to 61.4 per cent by the end of June 2005, 23.6 percentage points decline in country’s debt burden in 5 years. By end March 2006, public debt further declined to 54.7 per cent of the projected GDP for the year. Following the debt reduction strategy in which raising revenue was one of the key elements, the public debt burden in relation to total revenue has declined substantially from 562.5 per cent in 1999-2000 to 448.9 per cent by end-June 2005 and further to 384.9 per cent by end-March 2006 to the projected revenue for the year. During the last six years, the debt servicing liabilities have declined sharply from 65.4 per cent of revenue in 1999-2000 to 27.8 per cent of revenue and from 53.5 per cent to 27.8 per cent of current expenditure in 2005-06. The ratios of domestic debt to GDP and to tax revenue both decreased during 2005-06. The stock of domestic debt as per cent of GDP declined from 35.7 per cent in 2003-04 to 32.8 per cent in 2004-05 and further to 29.4 per cent by end March 2006.

As a result of prudent fiscal management over the last 6 years, the burden of interest payments on the domestic budget has declined sharply, thereby, releasing resources for development and social sector programmes. Interest payments as a percentage of total revenue have been reduced to one-half (41 per cent to 20 per cent) over the last six years. Similarly, share in total expenditure declined from 30 per cent to 16 per cent during the same period. Most importantly, as percentage of GDP, interest payments declined from 6 per cent to 2.6 per cent in the last six years.

Money & credit

The easy and accommodative monetary policy stance that had been pursued during the last few years by the SBP underwent considerable changes during the FY05, switching from a broadly accommodative to aggressive tightening in the second half of the last fiscal year, since April 2005. The same tight monetary policy stance continued during the current fiscal year despite declines in both core and overall inflation. Notwithstanding the tight monetary policy stance the SBP continued to strike a balance between promoting growth and controlling inflation on the one hand and maintaining a stable exchange rate environment on the other. Tight monetary policy stance is likely to continue until inflationary pressures are significantly eased off.

The State Bank of Pakistan has taken a number of steps in various areas to further enhance the effectiveness of the banking industry in Pakistan. Going forward, the SBP would continue to take measures aimed at expanding credit to priority sectors such as agriculture, SMEs and export sector. To further revamp the financial sector in line with the global financial system, the State Bank of Pakistan has set out a road map for the implementation of Basel-II. It is the new regulatory capital adequacy regime, which offers a series of approaches ranging from simple to more complex methodologies for capital allocation against credit and operational risk.

The credit plan for 2005-06 set the target for monetary expansion at Rs380 billion or 12.8 per cent higher than last year (FY05) on the basis of a growth target of 7.0 per cent and inflation target of 8 per cent. The money supply during July-April 22, 2006 of the current fiscal year expanded by Rs294.9 billion or 9.94 per cent as against an expansion of Rs332.4 billion or 13.37 per cent in the same period last year. The pace of monetary expansion remained well within the Credit Plan target for the year (12.8 per cent). Within the NDA, both net budgetary borrowings and borrowings for commodity operations remained well within the credit plan targets. The net credit to the Government for budgetary purposes was Rs43.3 billion compared to the annual credit plan target of Rs98 billion and Rs15.0 billion borrowed in the corresponding period of last year. However, credit to the private sector has exceeded the credit plan target and stood at Rs345.1 billion as against Rs330 billion envisaged for the year in the credit plan. Expansion in NFA stood at Rs37.8 billion owing mainly to the receipts of privatisation proceeds and issuance of sovereign bond. The proceeds from privatisation and sovereign bond not only helped build NFA; it also helped in containing the growth in NDA through the retirement of government debt held by the SBP.

Despite the tight monetary policy stance of the SBP, credit to the private sector was broad-based which grew by 20.2 per cent (Rs345.1 billion) during July-April 22, 2006 compared with the growth of 28.0 per cent or Rs357.4 billion during the same period of last year. Credit to the private sector continued to exhibit strong demand, reflecting the confidence of the private sector on the continuously improving macroeconomic fundamentals of the country. The manufacturing sector continued to be the largest recipient of bank credit, amounting to Rs130.0 billion during July- March 2005-06, 17.1 per cent more than the comparable period of last year and accounting for almost 47.9 per cent of the credit to private sector businesses. The growth in consumer loans remained robust, and their scale expanded by 27 per cent to Rs67.2 billion. The consumer loans were acquired to finance a range of products including automobiles (Rs23.2 billion) followed by personal loans (Rs21.5 billion), credit cards (Rs10.4 billion) and house building (Rs10.1 billion).

Credit disbursement to the agriculture sector, also remained consistent with the previous year trend. Scheduled banks and DFIs advances to the SME sector witnessed a growth of Rs40.6 billion during July-February FY06 compared with an expansion of Rs59.9 billion in the same period of last year. The scheduled banks have opened 304 offices during the period from 01-04-2005 to 31-03-2006. During July-March 2005-06, there was an increase of Rs303.9 billion (17.3 per cent) in the net advances of the scheduled banks. Their deposits increased by Rs272.9 billion (11.5 per cent) and their total investments increased by Rs77.1 billion during the first nine months of the current fiscal year. In 2005, the banking sector produced impressive results. The year has been unprecedented in terms of profits.

Pakistan continues to be at the forefront of the Micro-Finance Sector Development Programme (MSDP). Within the overall MSDP framework, Khushhali Bank (KB) is the lead micro-finance institution in Pakistan. The Bank now serves nearly 250,000 clients, with a cumulative disbursement of over Rs6.0 billion in 75 districts of Pakistan with high poverty incidence. Around 60 per cent of KB’s clients are in the rural areas, roughly one-third being women.

Capital market

During the fiscal year 2005-06, the stock market continued to maintain its strong performance and achieved new heights by creating many new records. The KSE-100 Index crossed the barrier of 12,000-mark for the first time in the history of capital market and touched an all time high on April 13, 2006. The KSE-100 index made further inroad and reached 12,274 points on April 17, 2006, showing a growth of 64.7 per cent over June 2005. Between December 2005 and April 2006 alone, the KSE share index increased by 25 per cent. Similarly, the total market capitalisation also increased to Rs3,419.4 billion on April 17, 2006 ($57.0 billion) from Rs2,013.2 billion ($33.7 billion), showing a growth of 70 per cent over June 2005. At current levels, KSE’s market capitalisation is equivalent to about 44.3 per cent of estimated GDP of FY06.

The improved performance of the stock market can mainly be attributed to consistent and transparent economic policies resulting in strong economic growth; a successful privatisation process attracting foreign investors in prestigious organization like PTCL and National Refinery; sound monetary policy of the SBP, maintenance of fiscal discipline and the capital market reforms including development measures introduced by the stock exchanges with full support of the SECP. The government’s economic policies and cap imports, registering a growth of 38.1 per cent in the first nine months (July-March) of the current fiscal year. Non-food non-oil imports also grew by 38.3 per cent, reflecting continued strong domestic demand. Major contributors to the rise in machinery imports include power generation machine (44.8 per cent), agriculture machinery (109.2 per cent), construction and mining machinery (29.0 per cent) and other machinery (51.7 per cent). A surge in imports of machinery reflects a growth in domestic investment driven imports, thus allowing the expansion of the country’s production base.

Imports of petroleum group have also played a key role in taking Pakistan’s import to a new height. Emerging as the single largest item in the country’s import bill, the Petroleum group import amounted to $ 4615.8 million, during the first nine months (July-March) of the current fiscal year as against $2,806.6 million in the same period last year. Thus an increase of 64.5 per cent resulted in an increase in trade deficit to $82620.3 million, in comparison to $4263.4 million in the same period last year.

Current account balance

Pakistan’s current account balance that slipped into red in 2004-05 after posting surpluses for three consecutive years remained in deficit in 2005-06, with a widening gap due to a higher import bill. This was brought about by high global crude prices and a hefty rise in non-oil imports. Furthermore, higher freight charges by international shipping lines as a result of sharp increase in global trade and higher fuel cost, and growth in personal travel due to the rising level of income of middle and high income groups, have also contributed to the widening of current account gap. Deceleration in the growth of net transfers is also responsible for widening of the current account deficit.

The current account deficit, excluding official transfers, stood at $4,696 million in the first nine months (July-March) of the current fiscal year as against $1181 million in the same period last year. As percentage of projected GDP for the year the current account deficit stood at 3.7 per cent as against 1.1 per cent in the same period last year. Although trade deficit (fob) almost doubled over the last year and services balance deteriorated by 27.5 per cent, the strong inflows under private transfers fuelled by rising workers’ remittances and resident foreign currency accounts offset some of the negatives with current account deficit standing at $4,696 million. The flow under long–term capital (net) improved markedly and risen to $3,905 million from $1,633 million last year.

External debt and liabilities

Pakistan’s total stock of external debt and foreign exchange liabilities grew at an average rate of 7.4 per cent per annum during 1990-99 -– rising from $20.5 billion in 1990 to $38.9 billion by end June 1999 but declined slightly to $37.9 billion in 1999-2000. It exhibited a declining trend thereafter. Pakistan’s external debt and liabilities have declined by $3.1 billion -– down from $38.9 billion in 1998-99 to $35.834 billion by 2004-05. However, external debt and liabilities increased to $36.557 billion by end-March 2006, thus showing a rise of $0.723 billion in the first nine months of the current fiscal year. The rise is mainly on account of issuance of sovereign bonds worth $800 million in March 2006.

External debt and foreign exchange liabilities, instead of growing at the pace of the 1990s, were in fact reduced from $38.9 billion in 1998-99 to $36.5 billion by end-March 2006 -— a reduction of $2.4 billion in seven years. Most importantly, the burden of the debt has declined substantially during the same period. For example, the external debt and liabilities as a percentage of foreign exchange earnings which stood at 335.4 per cent in 1998-99, declined to 127.6 per cent by end-March 2006. The external debt and liabilities stood at 64.1 per cent of GDP in end-June 1999, declined to 28.3 per cent in end-March 2006. The annual debt servicing payments made during the period 1999-2000 to 2003-04 averaged just above $5 billion per annum. This amount has drastically come down to around $3 billion in 2004-05. An amount of $2.4 billion has been paid during July-March 2005-06 and the amount rolled over declined from $4.1 billion in 1999-2000 to $1.1 billion in July-March 2005-06.

On March 23, 2006, Pakistan successfully issued $500 million new 10-year Eurobond and $300 million new 30-year bonds in the international debt capital markets lead managed by JP Morgan, Citi group and Deutsche Bank. This transaction, which represented the first international 144A bond issued by Pakistan since 1999, raised significant interest amongst international institutional investors. The 10-year notes were priced with a coupon of 7.125 per cent, framing a spread of 240bps over the relevant 10-year US Treasury benchmark and 187bps over the US$ mid-swap rate. The 30-year bonds were priced with a coupon of 7.875 per cent to, framing a spread of 302bps over the relevant 30-year US Treasury benchmark and 256bps over the US$ mid-swap rate. Pakistan was able to achieve spreads on both the new 10 and 30-year bonds that were tighter than its previous 5-year issues. By issuing 10 and 30 year tranches, Pakistan completed its primary objective of establishing a full Pakistani International yield curve in record time. With over 170 accounts participating, books closed with total orders exceeding US$2bn. The issue was over 2.5 times oversubscribed.

Education

Right to education is the basic requirement of every individual. Nations all over the world reached high levels of prosperity and human development through investing and prioritizing provision of quality and equitable health and education faculties to their citizens. East Asian economies are a recent example that shows how nations can benefit from an educated and productive labour force. Pakistan is in fact, entering into that phase of demographic transition, where in few years massive influx in the working age population (60 million) is expected. Thus, investing in providing quality education to the upcoming working age population is the only way to cash the demographic dividend.

Currently, the literacy rate is 53 per cent which is much below the targets set to be achieved in 2005 (60 per cent ESR and 58 per cent in PRSP) and far away from reaching the Millennium Development Goals (MDGs) target of 80 per cent literacy till 2015. Looking at the gender disaggregated data for overall literacy, 65 per cent of males and 40 per cent of females were literate in the year 2004-05. District disaggregated data for adult literacy show that, in Punjab Rawalpindi with 75 per cent is ranked at the top and Lohdran with 34 per cent at the bottom. Karachi with 78 per cent literacy is ranked at the top while Jacobabad with 43 per cent is ranked at the bottom in Sindh. In NWFP, Abbotabad (65 per cent) is at the top and Kohistan (25 per cent) at the bottom. Finally, in Balochistan Quetta (65 per cent) at the top and Jhal Magsi (20 per cent) and Qilla Saifullah (20 per cent) are at the bottom.

The key impediments to the progress in reaching a higher level of literacy in Pakistan are the low enrolment rates and poor quality of education provided by the public sector. In case of enrolments, net enrolment rate (NER) has seen a considerable increase of 10 percentage points from 42 per cent in 2001-02 to 52 per cent in 2004-05. The MDG targets to reach 100 per cent NER till 2015. This requires almost 50 per cent increase in enrolment in next 10 years, which is a huge challenge for the policy makers. Another factor that contributes to lower literacy rates is the high dropout rate at all levels. Major reasons behind dropout include poor quality of infrastructure, teacher’s absenteeism, quality of education and the value of returns attached to sending children to schools. There exist wide gender gaps especially in the rural areas in enrolments at all levels.

In the past year, 2,187 new primary schools were established, 1,221 in the public sector and 881 in the private sector. This increase has occurred in both rural and urban areas. Enrolment at the primary level increased from 19.92 million in 2001-02 to 21.33 million in 2004-05, 4.28 million to 4.55 million at the middle level and 1.79 million to 1.88 million at the secondary level during 2001-02 to 2004-05. During the past four years 249 additional technical and vocational institutions were established. There is a significant increase of 35 universities during the period 2001-02 to 2004-05 including 13 new public and 22 new private universities.

Government of Pakistan is currently spending 2.1 per cent of its GDP on education sector which is very low as compared to other countries in the region. The share of education sector has not seen much change in the past several years, in fact it has stagnated to about 2 per cent from 2003-2005. The government has launched several programmes to increase coverage by increasing enrolment and to improve the overall quality of education but these initiatives need proper implementation and constant monitoring for their timely completion.

Health

Importance of the health in the social lives of the people makes it such an important area that it cannot be considered in isolation and it is inextricably tied to other socio economic and political realities. The Constitution of Pakistan in its article 38 titled “promotion of social and economic wellbeing of the people” ensures the provision of basic necessities of life including health and medical relief for all citizens, irrespective of sex, caste, creed or race. The government of Pakistan recognizes and acknowledges the access to essential health care as a basic human right that is why the public health sector has always been a priority area of the government activities. The government of Pakistan is fully aware of its commitment to achieve Millennium Development Goals (MDGs) regarding health and initiatives have been taken to address health issues under PRSP and MTDF.

There is a considerable improvement in health care facilities over the past year as the existing vast network of health care facilities consist of 946 hospitals, 4,554 dispensaries, 5,290 basic health units/sub health centres (BHUs/SHCs), 552 rural health centres (RHCs), 907 maternal and child health centres (MCHs) and 289 TB centres (TBCs). Available human resources for the fiscal year 2005-06 turn out to be 118,160 doctors, 6,761 dentists and 33,427 nurses, which make the ratio of population per doctor as 1,310, population per dentist 25,297 and population per nurse as 4636. The new health facilities added to overall health services include construction of 56 new facilities (42 BHU and 14 RHCs), upgrading of 59 existing facilities (18 RHCs and 41 BHUs) and addition of 3,500 new doctors, 1,900 nurses, and 15,000 lady health workers. The total outlay on health sector is budgeted at Rs40 billion which shows an increase of 5.3 per cent over the last year and turns out to be 0.51 per cent of GDP. To reduce incidence of disease and to alleviate their suffering and pain so as to improve the health status of people, various health programmes like lady health worker programme, malaria, tuberculosis, HIV/AIDS control programmes, the expanded programme on immunization, National Maternal and Child Health Programme, Prime Minister Programme for Prevention and Control of Hepatitis in Pakistan, Drug Abuse, Cancer Treatment programme remained operative during fiscal year 2005-06.

During the fiscal year 2005-06 the caloric availability per day is likely to increase from 2271 to 2328 and protein availability from 65.5 to 66.9 grams PSLM 2004-05 reports district level data for major indicators in the health sector such as sickness/injuries, immunization, pre and post natal consultation etc. In the case of immunization, the top ranked districts are Jhelum (Punjab), Hyderabad (Sindh), Chitral (NWFP) and Gwadar (Balochistan). The districts reporting lowest immunization are Muzaffar Garh (Punjab), Jacobabad (Sindh), Shangla (NWFP) and Qilla Saifullah (Balochistan). The government of Pakistan needs to address the problem of the adversely affected districts and focus on policies to solve the problems and initiate immediate remedial measures.

Population, labour force and employment

Achieving a world population in balance with its environmental resources is crucial to the future of our planet and the welfare of its people. Population growth is a complex issue that directly or indirectly impacts all aspects of our lives and the conditions under which we live — from the environment and global stability to women’s health and empowerment. Pakistan being a developing country also faces the problem of over population. During the past 25 years, cultivable land has increased by 27 per cent compared to 98 per cent increase in population, resulting in reduced individual land holdings in Pakistan. Due to a high birth rate urban population will double in the next 20 years causing more and more forests to be cut to make way for humanity. Even now each year, deforestation occurs at the rate of 2.5 per cent. In addition, since only 60 per cent of our population has sewerage facility, the remaining 40 per cent churn out wastes damaging the environment and causing a lot of diseases. Rising levels of income on the one hand and easy availability of loan facility/ financing on the other has lead to an increase in motorization in the country and almost 70 per cent of our on-the-road vehicles have outlived their life span and emit un-burnt monoxide gases.

In Pakistan, labour force participation is estimated on the basis of the Crude Activity Rate (CAR) and the Refined Activity Rate (RAR). The CAR is the percentage of the labour force in the total population while RAR is the percentage of the labour force in the population of persons 10 years of age and above. The figures both for CAR (32.8 per cent) and RAR (46.9 per cent) for the first half of 2005-06 fare higher than LFS 2003-04 (30.4 per cent and 43.7 per cent). This phenomenon is more obvious for rural areas and women. Augmentation of the rates for the set of economic activities carried out within the house precincts also depicts the same scenario (42.8 Vs 38.5 per cent).

Agriculture still accounts for the largest source of employed work force. The share of agriculture in employment has increased from 43 per cent in 2003-04 to almost 45 per cent by mid of 2005-06. Sector wise break up of employed labour force shows that female labour force participation is on the rise for most sectors especially agriculture, fishery and telecom sectors. It is important to note that the employment of the rural females increased despite a considerable rise in female Labour Force Participation Rate. The increase in rural female employment was mainly in the category of unpaid family helpers, which may be due to enhanced growth rates in agriculture in recent years or due to the combined efforts of various NGO.

Transport and communication

A strong, efficient and affordable infrastructure is a critical element of a good investment climate and therefore, is a pre-condition to sustain the growth momentum. Transport and Communications both are important elements of infrastructure services and are essential in maintaining economic growth and competitiveness. In fact, the transport and communication sector in Pakistan account for about 11 per cent of GDP, 16 per cent of fixed investment, 6 per cent of employment and about 15 per cent of the Public Sector Development Programme. Road transport is a backbone of Pakistan’s transport system, accounting for 90 per cent of national passenger traffic and 96 per cent of freight movement. Over the past ten years, road traffic — both passenger and freight — has grown much faster than the country’s economic growth. The 9,518km long National Highway and Motorway network contributes about 3.7 per cent of the total road network and carries 90 per cent of Pakistan’s total traffic. The total length of roads in Pakistan was 258,340km, including 165,762km of high type (64 per cent) and 92,578km of low type roads (36 per cent) by the end of March, 2006. During the outgoing fiscal year, the length of high type roads has increased by 1.8 per cent over the last year but the length of low type roads has declined by 2.9 per cent. The construction work on Islamabad-Peshawar Motorway (M-1) however, is still in progress.

Furthermore, the Pakistan Railways have carried 61.3 million passengers and 4.3 million tons freight, with its gross earnings stood at Rs12.5 billion during July-March 2005-06. In comparison, PIA carried 3.972 million passengers during July-February 2005-06 as against 3.571 million in the same period last year, showing an increase of 11.2 per cent. Both passenger capacity and traffic volume also increased by 2.4 per cent and 8.7 per cent, respectively. In addition, its fleet consists of 41 aircrafts of various types. In addition, there are three private airlines, operating in the country and provide both domestic and international services.

Karachi Port has also handled 24,572,000 tons of cargo during July-March, 2005-06, compared to 21,845,000 tons during the same period last year, showing an increase of 12.5 per cent. Port Qasim has handled 16.8 million ton of cargo during July-March 2005-06 compared to 16 million cargo handled during the corresponding period last year, registering a growth of 5 per cent. Gwadar Port is also being built with Chinese assistance and its first phase has almost been completed.

In 1999-2000, there were only 0.3 million cellular mobile subscribers in Pakistan which jumped to 2.4 million by 2002-03 as a result of introduction of CPP regime and addition of another mobile operator (Ufone). Mobile subscribers continued to rise at an unprecedented pace, reaching 12.8 million by 2004-05. A major turnaround was witnessed when the mobile companies started giving free mobile connections and bearing the cost of government levies themselves. In a short period of 9 months in the outgoing fiscal year, more than 16 million new subscribers have been added to the list, reaching over 29.6 million by end April 2006. In other words, a more than 131 per cent increase in subscribers in just 9 months was unprecedented. Accordingly, the total teledensity (Fixed + Cellular + WLL) has jumped form 3.7 per cent in 2001-02 to 23.1 per cent by end March 2005-06.

For promotion of information technology, 2,339 cities/towns/ villages have been provided internet facility by March 2006. Total fixed telephone lines installed by March 2006 were 5.2 million as against 5.1 million up to June 2005 last year.

Energy

Global energy consumption is expected to increase steadily over the next twenty years. According to the International Energy Outlook 2001, the actual growth of world energy consumption increased from 207 quadrillion Btu in 1970, to 382 quadrillion Btu in 1999 which is anticipated to further increase to 607 quadrillion Btu in 2020. Over this fifty-year period, the consumption of energy will likely to increase by about 200 per cent, from 207 quadrillion Btu in 1970, to 607 quadrillion Btu in 2020. The largest increase in energy use will occur in the developing world. From 1999 to 2020, energy consumption in the developing countries is expected to climb 122 quadrillion Btu to 264 quadrillion Btu, depicting an increase of 116 per cent. In other words, the increase in energy use in the developing world is roughly double that of all countries in the global economy. Because, firstly many developing countries are striving towards economic development and industrialisation and will thus require additional energy. Secondly, virtually all of the increase in the world’s population over the next 20 years will take place in the developing world. Population growth will add over one billion people to the poorer regions, thus expanding the energy requirements for these regions.

Production of crude oil per day has decreased to 65,385 barrels during July-March 2005-06 from 66,199 barrels per day during the same period last year, showing a decline of 1.2 per cent. The overall production of crude oil decreased to 17.9 million barrels during July-March 2005-06 from 18.1 million barrels during the corresponding period last year, showing a decline of 1.1 per cent. On an average, the transport sector consumes 49.7 per cent of the petroleum products, followed by power sector (32.3 per cent), industry (11.8 per cent), household (2.5 per cent), other government (2.3 per cent), and agriculture (1.4 per cent) during last 10 years i.e. 1995-96 to 2004-05.

The average production of natural gas per day stood at 3,825 million cubic feet during July-March 2005-06 as compared to 3,663 million cubic feet over the same period last year, showing an increase of 4.4 per cent. The overall production of gas has increased to 1,048,190 million cubic feet during July-March 2005-06 as compared to 1,003,189 million cubic feet daily in the same period last year, showing an increase of 4.5 per cent. On average, the power sector consumes 36.6 per cent of gas, followed by fertiliser (22.5 per cent), industrial sector (18.8 per cent), household (18.4 per cent), commercial sector (2.8 per cent) and cement (1.3 per cent) during last 10 years i.e. 1995-96 to 2004-05.

Total installed capacity of electricity (Wapda, KESC, KANUPP and IPPs) stood at 19,439mw during July-March 2005-06, compared to 19,389mw during July-March 2004-05. Total installed capacity of Wapda stood at 11,363mw during July-March 2005-06 of which, hydel accounts for 56.9 per cent or 6,463mw, thermal accounts for 43.1 per cent or 4,900mw. During the first three quarters of current fiscal year, 63,978 GWh electricity has been generated as against 61,758 GWh were produced in the same period last year. The number of villages electrified increased to 99,595 by March 2006 from 90,467 up to 2004-05, showing an increase of 10 per cent.

Presently, some 930 CNG stations are operating in the country, while 200 are under construction. By March 2006 about one million vehicles were converted to CNG as compared to 700,000 vehicles during the same period last year, showing an increase of 43 per cent. With these developments Pakistan has become the leading country in Asia and the third largest user of CNG in the world after Argentina and Brazil.

Environment and housing

Environment: Sustainable development remains the cornerstone of government policies, and the concern for environment, its protection, renewal and enrichment is recognized as an obligation for the betterment of all citizens. The poverty-environment nexus has been of particular interest in the recent years, as poverty in Pakistan, like in many other middle-income countries, plays an important role in increasing the vulnerability of the poor to pollution and environmental degradation.

Several policies, plans, programmes and projects have been initiated for environmental protection and conservation in the sectoral areas of water and air pollution control, land use, forest management, energy efficiency, biodiversity conservation, and waste management, etc. One of the major achievements during 2005-06 was the formulation of the “National Environmental Policy 2005” which addresses the sectoral issues such as (a) water management and conservations, (b) energy efficiency and renewable, (c) agriculture and livestock, (d) forestry and plantation, (e) biodiversity and protected areas, (f) climate change, air quality and noise, and (g) pollution and waste management.

The key factors contributing to air pollution in Pakistan are: a) rapidly growing energy demand; b) increasing industrial and domestic demand and c) a fast growing transport sector. In the cities, widespread use of low-quality fuel, combined with a dramatic expansion in the number of vehicles on roads, has led to significant air pollution problems. Air pollution levels in Pakistan’s most populated cities are among the highest in the world, causing serious health issues in the process. The government is promoting the use of CNG in a big way to reduce the pollution level. Presently, some 935 CNG stations are operational through out the country, while another 200 are under construction. As of April 2006, the total number of CNG vehicles stood at 950,000, compared to 700,000 vehicles in April 2005, making Pakistan’s CNG fleet the largest in Asia and the third largest in the world after Argentina and Brazil.

Water availability in Pakistan continues to decrease, both in total amount of water as well as in the per capita water availability in Pakistan. In 1951, when population stood at 34 million, per capita availability of water was 5300 cubic meter, which has now decreased to 1105 cubic meter, just touching water scarcity level of 1000 cubic meter. With a present growth in population and the low rainfall, the threshold limit of water scarcity i.e. 1000 m3 of water per capita per year may be reached as early as the year 2010. Various mega initiatives have been planned especially under Wapda vision 2025. The estimates show that the current water shortage of 9 million acre feet would aggravate to 25 MAF if all planned dams under Vision 2025 are not constructed by 2016.

The government is committed to supply safe drinking water to its people and in this regard has started implementation of a “Clean Drinking Water Initiative” Project in 2005, which caters for the installation of 544 water purification plants of 2000 gallons/hour capacity, one in each Tehsil of Pakistan. A new project on “Clean Drinking Water for All” under Khushhal Pakistan Programme, has been recently approved and caters for installation of around 6035 water purification plants of different capacities (500/1000/2000 gallons/ hour), one in each union council of Pakistan.

Like many other developing countries, dry lands in Pakistan are severely affected by land degradation and desertification due to unsustainable land management practices and increasing demand of natural resources causing enormous environmental problems. The situation is further aggravated by scarcity of water, frequent droughts and miss-management of land resources, contributing to expansion of deserts, reduced productivity and consequently increases in rural poverty. In order to address the problems of land degradation and desertification, the ministry of environment, government of Pakistan, has taken an initiative and designed a full-scale project on “Sustainable Land Management to Combat Desertification in Pakistan”. The project aims at combating desertification and improving land management practices to eradicate poverty in arid and semi-arid regions of Pakistan.

The forestry sector plays an important role in soil conservation, water regulation for irrigation and power generation, reduction of sedimentation in water conveyances and reservoirs, employment and maintenance of ecological balance. Under the Millennium Development Goals of the Forestry Sector, Pakistan is committed to increase forest cover from existing 5 per cent to 5.7 per cent by the year 2011 and to 6 per cent by the year 2015. This implies bringing an additional 1.051 million hectares land area under forest.

The government of Pakistan is implementing a number of policies and programmes in the environment sector. National Environment Action Plan (NEAP) remains the flagship programme of the ministry of environment. The main objectives of NEAP are to safeguard public health, promote sustainable livelihood and enhance quality of life for the people of Pakistan. It focuses on clean air, clean water, solid waste management and eco-system management.

Housing Sector: Housing is one of the basic human requirements, as every family needs a roof. Providing shelter to every family has become a major issue as a result of rapid urbanization and higher population growth. According to the housing census 1998, the housing backlog, which stood at 4.30 million, has been currently projected at 6.19 million. It is estimated that to address the backlog and to meet the housing shortfall in the next 20 years the overall housing production has to be increased to 500,000 housing units annually. The present housing stock is also rapidly aging and estimates suggest that more than 50 per cent stock is over 50 years old. It is also estimated that 50 per cent of the urban population now live in slums and squatter settlements. Meeting the backlog in housing, besides replacement of out-lived housing units is beyond the financial resources of the Government. This necessitates putting in place a framework to facilitate financing in the formal private sector and mobilize non-government resources for a market based housing financed system. The government of Pakistan is, therefore, encouraging participation of local as well foreign investors/developers and private sector companies in housing sector to build more and more housing projects to meet the demands of a vast segment of society.

Having realized the importance of the housing sector in the overall economic development of the country, the government, as an immediate measure, declared Housing and Construction as a priority industry and simultaneously formulated a pragmatic and workable National Housing Policy. This is aimed at revitalizing the housing sector, providing therein various incentives for the construction industry and the private sector builders/developers. The salient features of this policy include: (i) Identify the state and other lands for housing development, (ii) To encourage the financial institution to give mortgage loans for housing at market rates. Commercial banks shall also be encouraged to advance loans for housing, by earmarking a substantial percentage of their loan portfolio, (iii) The annual disbursement of HBFC loans shall be enhanced from the present Rs1.2 billion to Rs7.00 billion over the next five years. (iv) Simplification of procedures for land transactions and standardisation of mortgage documents to facilitate sale and purchase of housing. (v) Stamp duties and registration fees, which are exceptionally high as compared to other countries, shall be adequately reduced to an aggregate total of 1 per cent to enhance registration, improve documentation and increase revenue receipts. (vi) Property tax on rented property shall be reduced from the current high rate of 25 per cent to 5 per cent. (vii) All new construction of houses on plots measuring up to 150 sq-yrds & flats/apartments having an area of 1,000 sq-ft shall be exempt from all types of taxes for a period of 5 years. (viii) Provincial governments shall develop packages in which prime state land within urban centres, occupied by the katchi abadis, shall be offered to the private developers for commercial use provided they arrange and finance upgradation or relocation of katchi abadis.

As a result of the coordinated efforts of federal and provincial governments and concerned private sector stakeholders, a large number of policy measures have so far been implemented resulting in the improvement of overall housing situation in the country besides availability of affordable housing finance to the extent of Rs34 billion in the market.
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Post 1980: Pakistan

1980: Pakistan

Soviet invasion of Afghanistan.


The occupation of Afghanistan by Soviet troops, beginning in December 1979, raised Pakistani fears for their own security. The government undertook three main approaches in dealing with the crisis. The first approach was to explore a possible revitalizing of the relationship with the United States. Early in the year, the United States offered $400 million in economic and military aid to Pakistan, in an attempt to provide a modicum of security, but Pakistan turned it down, considering it an inadequate response to the grave threat facing the country and believing that only a formal treaty approved by the U.S. Congress would send the necessary message to Moscow. The unwillingness of the Carter administration to proceed along these lines was reportedly taken to indicate a lack of American seriousness. A visit by the U.S. presidential national security adviser, Zbigniew Brzezinski, to Pakistan failed to resolve many of the two nations' differences.

A second approach was based on the belief that concerted action by the Islamic bloc would make it more difficult for the Soviets to sustain the occupation or, at least, to move against other countries. Toward this end, an Islamic Foreign Ministers Conference was held in the Pakistani capital of Islamabad in late January and again in May, and a special group composed of representatives of three countries, including Pakistan, was set up to seek ways of resolving the Afghan situation and securing the withdrawal of Soviet troops.

Pakistan's friendship with China suggested a third approach to the Afghan situation. While it was acknowledged that Peking's options were somewhat limited, its support for Pakistan was expected to discourage Moscow from taking any major action against the Pakistanis—particularly if China's support was coordinated with American assistance.

The presence of over a million Afghan refugees in Pakistan has been an additional source of potential trouble between Pakistan and the Soviet Union. Two Pakistanis were killed in a border attack in late September, and the Soviets made numerous reconnaissance flights over the refugee camps. In addition, the refugees are an economic burden that Pakistan can ill afford. Pakistan's President Muhammad Zia ul-Haq met with U.S. President Jimmy Carter in early October to discuss economic assistance for the refugees, among other matters of concern.

Other foreign relations.

The fall of the shah of Iran, in 1979, led to initial concern in Islamabad, because of the traditionally close relations between Iran and Pakistan during the years of the monarchy. However, a rapport was established with the revolutionary regime in Tehran on matters of regional interest. In September, Zia undertook a "goodwill" mission to Tehran and Baghdad, aimed at exploring a possible end to the Iran-Iraq war; he was politely received but given no encouragement.

Relations with India became critically important due to the sensitive situation on the Pakistani-Afghan border. Relations had improved under the government of Morarji Desai; the return of Indira Gandhi to power was expected to lead to difficulties, with India playing a tougher role as regional leader.

U.S. opposition to the Pakistani nuclear program continued, although public condemnation was muted by the events in Afghanistan. When the United States agreed to send enriched uranium nuclear fuel to India, Pakistanis believed that they were being singled out for punishment and that there was a legitimate need to continue the program. On August 31, Pakistan announced that the country had become self-sufficient in nuclear fuel production for the Karachi nuclear power plant.

Government and politics.

The grave repercussions that had been predicted following the execution of former Premier Zulfikar Ali Bhutto in 1979 did not materialize in 1980. Domestic political demands were toned down somewhat, in light of the Soviet invasion of Afghanistan, although there was some pressure for a return to civilian government. Political activity remained banned, and the military government made vague promises for free elections, but no date was set. In the meantime, the population was polarized between leftist and rightist elements, with strong grass-roots support for an increased Islamization of the country.

This summer, the government announced the formation of "Zakat" committees for the collection of taxes to be distributed to the poor and needy, as prescribed under Islamic law. The Shiite community, comprising some 15 million people, objected to the mandatory program and also contended that their contributions should be distributed within their own community and not dispersed by the government. This led to a major demonstration by the Shiite Muslims in Islamabad, as a result of which the government exempted them from these laws.

Economy.

Pakistan's economic performance improved during 1979-1980. The overall growth rate was 6.2 percent, with manufacturing improving by 8.1 percent (up from a 7.4 percent increase in 1978-1979) and agriculture by 6 percent (up from 4.2 percent in the previous year). The government reported that the average annual growth rate in Pakistan over the past three years was 6.4 percent, in sharp contrast with an annual growth of 3.7 percent during 1970-1977.

There were record harvests of wheat, at 10.87 million tons, and cotton, at 4.2 million tons, not only because of an increase in the area under cultivation but also because of a significant increase in the yield per acre. Specific efforts were taken to move the country toward food self-sufficiency, such as price supports, promotion of rust-resistant wheat varieties, provision of fertilizer and irrigation water, encouragement of the use of farm machines, and educational programs for farmers.

Despite these gains, the economic situation remained precarious. In the absence of national savings, the country remained heavily dependent on external borrowing, which totaled $822 million for the period from December 1979 to July 1980. Foreign aid commitments during 1979-1980 totaled $939 million, compared with $1,426 million for 1978-1979. Total pledges from the Aid Pakistan consortium (both bilateral and multilateral) amounted to $675 million, as compared with $845 million for 1978-1979. U.S. assistance remained limited to $40 million in agricultural commodities. Pakistan's current foreign debt stood at $5.5 billion, which constituted nearly 32 percent of the gross national product, and Pakistan was unable to get any debt rescheduling.
Pakistan's oil import bill (a factor in its debt problems) amounted to $1.2 billion for 1979-1980. Efforts to offset this high cost from indigenous sources have thus far yielded modest results, with only 10 percent of the 1980 oil consumption being met from domestic output.

Area and population.

Area, 310,724 sq. mi.
Pop. (est. 1980), 86.5 million.
Principal cities (est. 1975):
Islamabad (cap.), 250,000;
Karachi, 3,500,000;
Lahore, 2,100,000.

Government.

Islamic republic under martial law. Pres. and chief martial law administrator, Gen. Muhammad Zia ul-Haq.

Finance.

Monetary unit: Pakistani rupee; 1 rupee = US$0.1030.
Trade (est. 1979-1980).

Exports, $1.8 billion;

Imports, $3.2 billion.

Principal exports:

rice, raw cotton, cotton yarn, cotton cloth, wool carpets, leather, fish, sports goods.

Principal imports:

petroleum products, wheat, edible oils, fertilizers, tea, chemicals, tires, medicines, iron and steel.

Education (est. 1979-1980).

Enrollment:
primary schools, 5.9 million;
secondary schools, 1.3 million;
high schools, 500,000;
junior colleges, 195,000;
universities, 28,500.

Literacy rate, 19.8%.

Agriculture (est. 1979-1980).

Production (in millions of tons):

wheat, 10.87;
cotton, 4.2;
rice, 3.2;
sugarcane, 27.

Armed forces (est. 1980).

Army, 408,000;
navy, 13,000;
air force, 17,600;
paramilitary forces, 109,000.
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Post Civil War Erupts in Pakistan

Civil War Erupts in Pakistan


The 1,000 miles that separate West and East Pakistan only begin to suggest the schism that has divided that nation since its birth. The roots of the conflict between West and East Pakistan lie in the history of Islam in the Indian subcontinent.

After the breakup of the Muslim Mogul empire early in the eighteenth century, the local Indian rulers and the European expansionists—the French, Dutch, and Portuguese and the British East India Company—sought the remnants of his disintegrating empire, which at its greatest extent included most of the Indian subcontinent. The East India Company discreetly proceeded to make the local rulers so-called allies rather than subordinates; in so doing, it isolated them from potential friends, disarmed their military forces, and thus effectively limited their power.

Replacing the ruling Muslim elite with its own soldiers and administrators, the company drove the Muslims, who scorned service under the new rulers, from positions of authority. The Hindus, formerly subordinate to the Muslims even though they outnumbered them, entered into the company's service. When the revolt of Indian soldiers against British rule in 1857-1859 was unsuccessful, the Muslims lost hope of reestablishing their authority. This uprising, known as the Sepoy Mutiny, ended the power of the East India Company, and the British government assumed direct responsibility for the government of India.

The decision by Lord Curzon (then viceroy of India) in 1905 to divide the unwieldy province of Bengal into Hindu and Muslim provinces (the Hindus were concentrated in the west, the Muslims in the east) marked a political turning point for the Muslims. The Muslim minority favored the partition; the Hindus, who felt the division would decrease their influence, opposed it. Although the partition was annulled a few years later, the hostility between the Hindus and the Muslims was sorely aggravated. The embittered Muslims, who had been content to rely on the government for the protection of their interests, felt the need for an effective political organization, and in 1906 they established the All-India Muslim League. The Hindus meanwhile sought constitutional reform through the Indian National Congress.

Although mutual disappointment with the British at times brought the league and the congress closer together, the gradual clarification of the British intention to grant self-government to India along the lines of parliamentary democracy led the Muslims to fear subjugation to the Hindu majority—politically, economically, and culturally. The Government of India Act of 1935, which granted more provincial autonomy and transferred considerable power to the Indian ministers, rapidly intensified existing Hindu-Muslim tensions.

In the 1937 elections, the Indian National Congress fared well, but the league was a relative failure, winning only 108 out of 482 seats reserved for Muslims at the provincial level. This failure acted as a spur to Muslim leaders and led to the revival of the idea of a separate Muslim state, an idea which had been articulated in 1930 by the philosopher and political leader Sir Muhammad Iqbal. This idea was given the name Pakistan, a Persian and Urdu word meaning "land of the pure" and an acronym for eight territories of British India and Central Asia which might have been incorporated into a single Muslim state—Punjab, Afghania (the Northwest Frontier province), Kashmir, Iran, Sind, Tukharistan, Afghanistan, and Baluchistan. Ironically, the Cambridge University student who coined the word did not include in the area the province of Bengal.

The idea of a nation built on shared faith in Islam produced a leader with a mandate, Mohammed [also spelled Muhammad] Ali Jinnah. A longtime advocate of Hindu-Muslim unity, Jinnah reluctantly came to accept the idea of Pakistan. Once convinced, however, he pursued his goal tenaciously. The "great leader" of millions of Muslims, he was to become their sole voice and the architect of Pakistan.

When the British announced in 1940 that they intended to grant dominion status to India after World War II, both the anxious league and the congress stiffened their demands as to what form self government should take. At its annual meeting in Lahore in March 1940, the league adopted a resolution calling for the creation of independent states in the northwestern and eastern zones of India. British officials almost unanimously regarded the Pakistan demand either as a deliberate overbid by the league to obtain full consideration for the Muslim point of view or as a plan to checkmate the demands of the Indian National Congress. (Indeed, the All-India Muslim League officially adopted Pakistan as its goal only in April 1946; moreover, the wording of the Lahore resolution was vague as to whether these independent states were to be autonomous within or outside some kind of all-India union.) However, nationalism was an established political phenomenon, and it was natural for the league to express its demands for freedom in terms of a Muslim nation.

The British presented various independence plans in 1942, 1945, and 1946, but none of them was acceptable to the deadlocked Muslims and Hindus. Meanwhile communal tensions grew, and widespread violence often erupted. Finally, on February 20, 1947, British prime minister Clement R. Attlee announced that the British would withdraw no later than June 1948, whether or not the congress and the league had reached an agreement; both parties seemed shocked into the desire to negotiate a settlement. The pace of events quickened.

That June, [British viceroy] Lord [Louis] Mountbatten, who was sent to India in March to settle the disputed issues, announced plans for independence and partition. The agreement, the Indian Independence Act, which came into effect on August 15, 1947, granted dominion status to India and Pakistan and left certain areas the right to choose which nation they wished to join.

Either by referendum or by vote of their provincial legislatures, five predominantly Muslim provinces—Bengal, Punjab, Sind, Baluchistan, and the Northwest Frontier—elected to join Pakistan; both Bengal and the Punjab were to be divided, for, as expected, eastern Bengal and western Punjab (predominantly Muslim areas) opted for Pakistan, while western Bengal and eastern Punjab (predominantly Hindu areas) opted for India. The details of boundaries in the divided provinces were decided by Sir Cyril Radcliffe, since the Hindu and Muslim representatives on the boundary commissions which he chaired totally failed to agree.

Ironically, instead of bringing peace, the partition exacerbated communal tension and brought violence, chaos, and one of the greatest migrations in history, involving some 13 million people. Muslims in India fled to Pakistan, and about an equal number of Hindus in Pakistan fled to India. Whole villages were wiped out, and fleeing refugees were massacred by the trainload. Fighting was especially fierce in the Punjab, where there had long been bitter hatred between the Muslims and the Sikhs, whose communities straddled the partition line.

After the death in 1948 of Jinnah, the country's first governor-general, and the assassination in 1951 of Liaquat Ali Khan, the prime minister, Pakistan entered an era during which corruption dominated the political scene and domestic conditions deteriorated. Religion alone was not to prove strong enough to unite the distant wings of Pakistan and to transcend the profound differences of language and culture that separated the 55 million West Pakistanis and the 75 million Bengalis of East Pakistan.

From the beginning, the slight, dark Bengalis found themselves discriminated against and exploited by the more prosperous and better-developed western region, dominated by the tall, light-skinned Punjabis and Pathans. Even Jinnah, the nation's founding father, declared that the East Pakistanis should give up their native Bengali, a language of Indo-Aryan origin, and adopt Urdu, a synthesis of Persian and Hindi spoken in the West. It was only after years of riots and demonstrations that they succeeded in getting Bengali adopted as a national language along with Urdu.

Economically, for many years East Pakistan earned most of the nation's foreign exchange and watched the proceeds being used to build up industries in the West. Most state development projects were allocated to the West, while Bengal remained poor and backward and the economic disparity between the nation's two wings increased. Few Bengalis were recruited for the military, which, like the government, was controlled by the West Pakistanis.

Such grievances led the Bengalis to demand a greater degree of autonomy and equal representation in their government. When East Pakistan's Awami League, the dominant political party led by Sheikh Mujibur Rahman, won a majority last year in Pakistan's first nationwide direct elections, these hopes seemed within their grasp. But the National Assembly never convened. President and dictator Yahya Khan, a Pathan, postponed its meeting and in March of this year sent troops into Bengal to crush the separatist movement.

This 1972 Collier’s Year Book article describes the historical events leading to the partition of India, and the reasons East Pakistan became the independent nation of Bangladesh in 1971.
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Post East India Company

East India Company


I -INTRODUCTION

East India Company, any of a number of commercial enterprises formed in western Europe during the 17th and 18th centuries to further trade with the East Indies. The companies, which had varying degrees of governmental support, grew out of the associations of merchant adventurers who voyaged to the East Indies following the discovery in 1497 of the Cape of Good Hope route by Portuguese navigator Vasco da Gama. The most important of the companies were given charters by their respective governments, authorizing them to acquire territory wherever they could and to exercise in the acquired territory various functions of government, including legislation, the issuance of currency, the negotiation of treaties, the waging of war, and the administration of justice. The most notable companies were the following.

II -DANISH EAST INDIA COMPANY

Chartered in 1729 by King Frederick IV of Denmark after unsuccessful attempts by Denmark to gain a share of the East India trade in 1616 and 1634, it enjoyed great prosperity in India until the advance of British power there in the late 18th century. As a consequence of the destruction of Danish naval power in the war between Britain and Denmark in 1801, the power of the Danish company was broken. Its principal Indian possessions, Tranquebar in Tamil Nādu and Serampore in Bengal, were purchased by Britain in 1845.

III -DUTCH EAST INDIA COMPANY

Incorporated from a number of smaller companies by the States General of the Netherlands in 1602, its monopoly extended from the Cape of Good Hope eastward to the Strait of Magellan, with sovereign rights in whatever territory it might acquire. In 1619 Jan Pieterszoon Coen, regarded as the founder of the Dutch colonial empire in the East Indies, established the city of Batavia in Java (now Jakarta, Indonesia) as the headquarters of the company. From Batavia, Dutch influence and activity spread throughout the Malay Archipelago and to China, Japan, India, Iran, and the Cape of Good Hope. During the course of the 60-year war between Spain and the Netherlands (1605-1665), the Dutch company despoiled Portugal, which was united with Spain from 1580 to 1640, of all its East Indian possessions. It supplanted the Portuguese in most of present-day Indonesia and in the Malay Peninsula, Ceylon (now Sri Lanka), the Malabar Coast of India, and Japan.

During this period it was also successful in driving English rivals from the Malay Archipelago and the Moluccas. In 1632 the Dutch killed the English factors, or agents, in Amboina, capital of the Dutch Moluccas; for this act the English government later exacted compensation. In 1652 the company established the first European settlement in South Africa on the Cape of Good Hope. At the peak of its power, in 1669, the Dutch company had 40 warships, 150 merchant ships, and 10,000 soldiers.

Between 1602 and 1696 the annual dividends that the company paid were never less than 12 percent and sometimes as high as 63 percent. The charter of the company was renewed every 20 years, in return for financial concessions to the Dutch government. In the 18th century, internal disorders, the growth of British and French power, and the consequences of a harsh policy toward the native inhabitants caused the decline of the Dutch company. It was unable to pay a dividend after 1724 and survived only by exacting levies from native populations. It was powerless to resist a British attack on its possessions in 1780, and in 1795 it was doomed by the ouster of the States General at home by the French-controlled Batavian Republic. In 1798 the republic took over the possessions and debts of the company.

IV -ENGLISH EAST INDIA COMPANY

The most important of the various East India companies, this company was a major force in the history of India for more than 200 years. The original charter was granted by Queen Elizabeth I on December 31, 1600, under the title of “The Governor and Company of Merchants of London Trading into the East Indies.” The company was granted a monopoly of trade in the East Indies, with the formal restriction that it might not contest the prior trading rights of “any Christian prince.” The company was managed by a governor and 24 directors chosen from its stockholders.

In early voyages the company penetrated as far as Japan, and in 1610 and 1611 its first factories, or trading posts, were established in India in the provinces of Madras and Bombay. Under a perpetual charter granted in 1609 by King James I, the company began to compete with the Dutch trading monopoly in the Malay Archipelago, but after the massacre of Amboina the company conceded to the Dutch the area that became known as the Netherlands East Indies. Its armed merchantmen, however, continued sea warfare with Dutch, French, and Portuguese competitors.

In 1650 and 1655 the company absorbed rival companies that had been incorporated under the Commonwealth and Protectorate by Lord Protector Oliver Cromwell. In 1657 Cromwell ordered it reorganized as the sole joint-stock company with rights to the Indian trade. During the reign of Charles II the company acquired sovereign rights in addition to its trading privileges. In 1689, with the establishment of administrative districts called presidencies in the Indian provinces of Bengal, Madras, and Bombay, the company began its long rule in India. It was continually harassed by traders who were not members of the company and were not licensed by the Crown to trade.

In 1698, under a parliamentary ruling in favor of free trade, these private newcomers were able to set up a new company, called the New Company or English Company. The East India Company, however, bought control of this new company, and in 1702 an act of Parliament amalgamated the two as “The United Company of Merchants of England Trading to the East Indies.” The charter was renewed several times in the 18th century, each time with financial concessions to the Crown.

The victories of Robert Clive, a company official, over the French at Arcot in 1751 and at Plassey in 1757 made the company the dominant power in India. All formidable European rivalry vanished with the defeat of the French at Pondicherry in 1761. In 1773 the British government established a governor-generalship in India, thereby greatly decreasing administrative control by the company; however, its governor of Bengal, Warren Hastings, became the first governor-general of India. In 1784 the India Act created a department of the British government to exercise political, military, and financial control over the Indian affairs of the company, and during the next half century British control was extended over most of the subcontinent.

In 1813 the company's monopoly of the Indian trade was abolished, and in 1833 it lost its China trade monopoly. Its annual dividends of 10.5 percent were made a fixed charge on Indian revenues. The company continued its administrative functions until the Sepoy Rebellion (1857-1859). In 1858, by the Act for the Better Government of India, the Crown assumed all governmental responsibilities held by the company, and its 24,000-man military force was incorporated into the British army. The company was dissolved on January 1, 1874, when the East India Stock Dividend Redemption Act came into effect.

V - FRENCH EAST INDIA COMPANY

Established in 1664 by Jean-Baptiste Colbert, finance minister of King Louis XIV, the company founded its first trading post at Surat in Bombay in 1675. The following year it set up its principal Indian base at Pondicherry, on the Coromandel Coast. The company prospered and extended its operations to China and Iran. In 1719 the company was reorganized with the American and African French colonial companies as the Compagnie des Indes. This company, headed by Scottish financier John Law, suffered severely with the collapse of the Mississippi Scheme. In 1730 it lost its slave trade with Africa, in 1731 its general trade with Louisiana, and in 1736 its coffee trade with the Americas. The company prospered in India, however, under governors Benoît Dumas, from 1735 to 1741, and Joseph François Dupleix, from 1742 to 1754.

Dupleix directed the unsuccessful French struggles against the British control of India. The capture of Arcot in 1751 by the British under Robert Clive limited French control to southern India, where it remained supreme until 1761, when the British captured Pondicherry. The operations of the company were finally suspended by royal decree in 1769, and in the following year it turned over its capital of more than 500 million livres to the Crown. In 1785 a new company received commercial privileges, but this company was abolished in 1794 during the time of the French Revolution.
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Post Sepoy Rebellion.

Sepoy Rebellion


Sepoy Rebellion (1857-1859), also known as the Indian War of Independence, uprising against British rule in India begun by Indian troops (sipahi or sepoys) in the employ of the English East India Company. The rebellion was the first concerted attempt by the people of South Asia to overthrow the British Indian Empire.

By the 1850s the English East India Company had established control over present-day India, Pakistan, Bangladesh, Myanmar (formerly known as Burma), and Sri Lanka. By conquest or diplomacy, the company had overrun numerous autonomous Indian kingdoms during the previous two decades. It had also reduced the emperor of the moribund Mughal Empire, a vast empire that had ruled the subcontinent for more than 300 years, to a pensioner in his palace in Delhi. A small elite of British civilian officials and an army of 160,000 men, only 24,000 of them British, controlled the vast division of British India known as the Bengal Presidency. This area stretched from Burma in the east to Afghanistan in the west and included huge territories in central India.

The Indian troops employed by the English East India Company felt that British rule often failed to respect their traditions of religion and caste. The sepoys’ discontent came to a head in late 1856, when rumors began circulating that the cartridges for the newly-issued Lee-Enfield rifles were greased with the fat of cows, which are sacred to Hindus, and pigs, which Muslims believe are unclean. If this rumor were true, any Hindu or Muslim soldier would be ritually polluted when he bit off the end of a cartridge, as was necessary before loading the rifle. There were several isolated cases of soldiers in the Bengal army refusing to use these cartridges, but the issue exploded in Meerut, a military town northeast of Delhi in the Ganges River valley. There, 85 men of the 3rd light cavalry refused to use the cartridges on April 23, 1857. They were convicted of mutiny, sentenced to prison terms, publicly fettered, and stripped of their military insignia.

In response to this harsh treatment of their fellow soldiers, members of the 11th and 20th infantry regiments revolted on the evening of May 10. They freed their comrades along with hundreds of civilian prisoners, and the rampaging mob slaughtered 40 British officers and civilians in Meerut. The sepoys then marched to Delhi, where other Indian regiments joined the mutiny. They massacred dozens of British there, and reinstated the 82-year-old Mughal emperor, Muhammad Bahadur Shah. The news of these events triggered mutinies throughout the Bengal army, rapidly igniting a general anti-British revolution in north and central India. Among those joining the sepoys in the uprising were Indian princes and their followers, whose territories had been annexed by the English East India Company, and people whose ways of life and sources of income had been disrupted by British trade, missionary activities, or social reforms.

Unprepared for and paralyzed by the mutiny at first, the British eventually rallied. To control the uprising in the Ganges valley, British commanders disarmed the sepoys in the nearby province of Punjab and assembled a small army that marched on Delhi, occupying a position outside of the city. The British command in Calcutta (now Kolkata) was able to contain the rebellion in the east while retaining control of the Ganges River and communications lines as far upriver as Allahābād. In central India, a British army of several thousand engaged in dozens of battles with forces led by several local princes and Rani (Queen) Lakshmibai of Jhānsi. The rani was fighting against annexation of her kingdom by the company after the death of her husband, the last ruler of Jhānsi.

In the central part of the Ganges River valley, the recently-annexed state of Oudh became the focal point for rebellion. On May 30, rebel forces besieged Europeans along with loyal Indians at the British Residency, the official residence of British administrators in the capital, Lucknow. A few days later the British garrison at Cawnpore (now Kānpur) also came under attack, enduring a siege that lasted until June 27. On that day, the survivors were attacked while evacuating to boats on the Ganges River under an agreement of safe passage negotiated with the rebel leader, Nana Sahib. Most of the British soldiers were killed. The women, children, and wounded who lived through this disaster were later murdered in prison. These events provided a rallying cry for British forces and a rationale for widespread atrocities committed against Indian combatants and noncombatants alike.

After many inconclusive battles fought before the walls of Delhi, the reinforced British army attacked the city on September 15 and overran it after five days of ferocious fighting. A relief force reached the Lucknow residency on September 25 but became pinned there until late November, when a second relief force broke the siege and evacuated the survivors. The British returned to Oudh in February 1858 with an army of more than 30,000 men, including troops lent by the kingdom of Nepal. The city of Lucknow fell on March 23 and the rebel forces in north India scattered. The fort at Jhānsi fell in April, and the rani was later killed in battle.

For the next year British forces engaged in running fights with ever-smaller rebel forces, finally capturing their most skillful opponent, Nana Sahib's general Tantia Topi. With his execution in April 1859, the revolt ended. The war had far-reaching consequences for India. The British government officially abolished the Mughal Empire and exiled Muhammad Bahadur Shah to Burma. The British crown also ended the administration of the English East India Company, assuming direct rule of India in 1858. Military policies altered dramatically. New recruits were sought primarily in Punjab and Nepal, where troops had remained loyal during the rebellion, and emphasis was placed on a doctrine stressing the hierarchy, prestige, and authority of the British officer corps. Thereafter the British administration displayed a pronounced distrust of its Indian subjects and a reluctance to share power or strategic technologies, an attitude that damaged relations with an emerging nationalist movement later in the century.
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