**Pakistan
Improvements in macroeconomic fundamentals, as well as recovery in the economy, were further consolidated in FY2003. Given continued buoyancy in both domestic and external sectors in the first half of FY2004, GDP growth is likely to exceed the government target of 5.3% for the year. It seems that the foundations have been laid for significantly higher growth and it should be possible to exceed the target of 5.8% in FY2005 and move to a path of over 6% in subsequent years.
**
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Outlook for 2004-2005
In a context of brisk growth in the real sectors of the economy in the first half of the year and of several factors conducive for growth, it is expected that GDP will rise more strongly than the government target of 5.3% in FY2004. The agriculture sector is expected to expand by 4.2%. Major summer crops other than cotton have shown higher output, and the winter crop prospects have improved due to greater availability of water in reservoirs, timely winter rains, and an increase in the support price of wheat. A sharp upswing in agricultural credit in the first half of FY2004 and a larger offtake of fertilizers in October 2003-January 2004 also point to better prospects for winter crops. The industry sector is likely to post higher growth in FY2004, propelled by continuing double-digit rises in textile exports and by domestic demand for consumer durables that has been fueled by a threefold increase in consumer credit in the first half of FY2004. LSM production rose by 14.7% during that period, compared with 5.3% in the same period in FY2003. Industrial growth should also benefit from higher hydropower generation resulting from greater availability of water. The services sector looks set to record continued strong performance with an upturn in output in the financial sector, as indicated by financial results for major banks and other financial institutions in the first quarter of FY2004. Telecommunications, particularly cell phone services, and electronic media (TV and radio stations) are also expanding rapidly, and the recent deregulation of the sector and issuance of licenses to new operators should sustain this trend.
Inflation started rising in the second quarter of FY2004 in the wake of reports of a wheat shortage. However, despite this, SBP continued its easy monetary policy during the first half of FY2004, when money supply (M2) growth accelerated slightly to 9.1%, from 8.6% in the same period in FY2003. Private sector credit picked up further, and as a result, interest rates have started inching up.
Table 2.17 Major Economic Indicators, Pakistan, 2001-2005, %
Item 2001 2002 2003 2004 2005
GDP growth 2.2 3.4 5.1 5.5 5.8
Gross domestic investment/GDP
15.5 14.7 15.5 16.5 17.0
Inflation rate (consumer price index)
4.4 3.5 3.1 4.0 4.0
Money supply (M2) growth
9.0 15.4 18.0 14.0 12.0
Fiscal balanceb/GDP
-5.2 -5.2 -4.4 -4.0 -3.9
Merchandise export growth
9.1 2.7 19.6 12.0 10.0
Merchandise import growth
6.2 -7.5 20.1 16.4 12.0
Current account balance/GDP
0.6 4.6 5.9 3.0 2.1
Debt service ratio
38.0 44.7 28.7 25.0 23.0
Sources: Ministry of Finance; State Bank of Pakistan; staff estimates.
http://www.adb.org/Documents/Books/ADO/2004/pak.asp
well done! atleast its moving upwards in right direction at last, hope this trend will continue without some looters jump in to eat all that up!
did mush bribed adb to write this 
