Economic Reforms and Macroeconomic Management in Pakistan

Pakistan was one of the few developing countries that had achieved an average growth rate of over 5 percent over a four decade period ending 1990. Consequently, the incidence of poverty had declined from 40 percent to 18 percent by the end of 1980s. But the 1990s proved to be a lost decade for Pakistan, Growth in per capita income dropped to slightly over 1 percent. Poverty resurfaced and about one third of the population now lives below the poverty live of $1 per day. Social indicators are worse than other countries with comparable income. The country was turned into one of the heavily indebted countries and was declared as one of the most corrupt country in 1996. The challenge facing the government which assumed power in October 1999 was to put the economy back to its pre 1990 track.