The economy of Pakistan is the 24th largest in the world in terms of purchasing power parity (PPP), and 42nd largest in terms of nominal gross domestic product. Pakistan has a population of over 207 million (the world’s 6th-largest), giving it a nominal GDP per capita of $1,629, which ranks 147th in the world for 2016. However, Pakistan’s undocumented economy is estimated to be 36% of its overall economy, which is not taken into consideration when calculating per capita income.Pakistan is a developing country and is one of the Next Eleven, the eleven countries and have a potential to be among the world’s large economies in the 21st century.
Major Export Commodities
The economy is semi-industrialized, with centres of growth along the Indus River. Primary export commodities include textiles, leather goods, sports goods, chemicals, carpets/rugs and medical instruments. Growth poles of Pakistan’s economy are situated along the Indus River, the diversified economies of Karachi and major urban centers in the Punjab, coexisting with lesser developed areas in other parts of the country.
Pakistan is currently undergoing a process of economic liberalization, including privatization of all government corporations, aimed to attract foreign investment and decrease budget deficit. In October 2016, foreign currency reserves crossed $24.0 billion which has led to stable outlook on the long-term rating by Standard & Poor’s. In 2016, BMI Research report named Pakistan as one of the ten emerging economies with a particular focus on of its manufacturing hub.
In October 2016, the IMF chief Christine Lagarde confirmed her economic assessment in Islamabad that Pakistan’s economy was ‘out of crisis’. The World Bank predicts that by 2018, Pakistan’s economic growth will increase to a “robust” 5.4% due to greater inflow of foreign investment, namely from the China-Pakistan Economic Corridor. According to the World Bank, poverty in Pakistan fell from 64.3% in 2002 to 29.5% in 2014. Pakistan’s fiscal position continues to improve as the budget deficit has fallen from 6.4% in 2013 to 4.3% in 2016. The country’s improving macroeconomic position has led to Moody’s upgrading Pakistan’s debt outlook to “stable”.
In 2017, Pakistan’s GDP in terms of purchasing power parity crossed $1 trillion.