Since independence in 1947, the economy of Pakistan has emerged as a semi-industrialized one, the on textiles, agriculture, and food production, though recent years have seen a push towards technological diversification.

Since independence, economic growth has meant an increase in average income of about 150 percent from 1950 to 1996, But Pakistan like many other developing countries, has not been able to narrow the gap between itself and rich industrial nations, which have grown faster on a per head basis.

[3] Overall, Pakistan has maintained a fairly healthy and functional economy in the face of several wars, changing demographics, and transfers of power between civilian and military regimes, growing at an impressive rate of 6 percent per annum in the first four decades of its existence.

[4] Archaeological excavations have uncovered streets, drainage systems, and water supplies in the valley's major cities of Harappa, Lothal, Mohenjo-daro, and Rakhigarhi, revealing an advanced knowledge of urban planning.

Agriculture was the predominant occupation, as it helped satisfy the villages' food requirements while also providing raw materials for cottage and small scale industries like textiles and handicrafts.

Mughal India was now the world's largest economy, responsible for almost a quarter of global production, as well as a sophisticated customs and taxation system within the empire.

Most overland trade was carried out via the Khyber Pass connecting the Punjab region with Afghanistan and onward to the Middle East and Central Asia.

[18] After gaining the right to collect revenue in Bengal in 1765, the East India Company largely ceased importing gold[19] and silver, which it had hitherto used to pay for goods shipped back to Britain.

[20] In addition, as under Mughal rule, land revenue collected in the Bengal Presidency helped finance the company's wars in other part of Indian subcontinent.

However, the infrastructure they created was mainly geared towards the exploitation of local resources, and left the economy stagnant, stalled industrial development, and resulted in an agricultural output that was unable to feed a rapidly accelerating population.

The creation of canal colonies was designed to relieve demographic pressures in the central parts of the province, increase productivity and revenues, and create a loyal support amongst peasant landholders.

See also[26] Economic growth during the 1950s averaged 3.1 percent per annum, and the decade was marked by both political and macroeconomic instability and a shortage of resources to meet the nation's needs.

Pakistan's economy was quickly revitalized under Ayub Khan, with economic growth averaging 5.82 percent during his eleven years in office from 27 October 1958 to 25 March 1969.

[28] Some academics have argued that while HYV technology enabled a sharp acceleration in agricultural growth, it was accompanied by social polarization and increased interpersonal and interregional inequality.

However, in 1974, the influence and authority of the left wing within the party significantly decreased: they had either been marginalized or purged.5 As a result, the second phase was less ideologically motivated, and was instead driven by the outcome of ad hoc responses to various situations.6 Between 1974 and 1976, the style of economic management Bhutto adopted reduced the role of the Planning Commission as well as its capacity to offer advice to political decision-makers.

Major heavy mechanical, chemical, and electrical engineering industries were immediately nationalized, as were banks, insurance companies, educational institutions, and other private organizations.

Bhutto also established Port Qasim, Pakistan Steel Mills, the Heavy Mechanical Complex (HMC) and several cement factories.

A tremendous boost to economic activity was provided by rising worker remittances, which reached a peak of US$3 billion in 1982–83, equivalent to 10 percent of the gross national product of Pakistan.

The GDP growth rate sank to 4 percent and Pakistan faced persistent fiscal and external deficits, triggering a debt crisis.

[43] Both parties have argued that this was due to interruptions in the democratic process, as well as unpredictable and difficult political circumstances, such as sanctions imposed after Pakistan's nuclear tests in 1998.

[44] Following a military coup in October 1999, Pervez Musharraf became the President of Pakistan in 2001 and worked to address the challenges of "heavy external and domestic indebtedness; high fiscal deficit and low revenue generation capacity; rising poverty and unemployment; and a weak balance of payments with stagnant exports.

"[38] At this time, the country lacked the foreign exchange reserves needed to cover its imports or service its debts, remittances and investments had decreased by millions, and Pakistan had no access to private capital markets.

The administrations of Asif Ali Zardari and Syed Yousaf Raza Gillani oversaw a dramatic rise in violence, corruption, and unsustainable economic policies that forced Pakistan to re-enter an "era of stagflation.

[48][49] In 2013, Nawaz Sharif returned to inherit an economy crippled by energy shortages, hyperinflation, mild economic growth, high debt, and a large budget deficit.

Shortly after taking office, Pakistan "embarked on a $6.3 billion IMF Extended Fund Facility, which focused on reducing energy shortages, stabilizing public finances, increasing revenue collection, and improving its balance of payments position.

"[1] Lower oil prices, better security, higher remittances, and consumer spending spurred growth toward a seven-year high of 4.3 percent in the fiscal year 2014-15[55] and foreign reserves increased to US$10 billion.

[74] An editorial in PakistanToday said the government had "handed over all powers to the IMF to take fiscal decisions for the next 40 months" in the 2019-20 federal budget presented in June.

"[78] In October 2019 it was reported that the CAD has been reduced by 80% to a 41-month low of $259 million.The Express Tribune said that measures such as increased interest rates and rupee devaluation decreased the account deficit, but "have adverely impacted the growth of gross domestic product (GDP) at the same time.

[85] In order to revive the suspended IMF program, Khan's government passed further austerity measures and revenue policies aiming to raise Rs600bn ($3.4bn), which led to opposition protest.

[89][90][91] Economist Atif Mian said after Imran Khan's government was removed in April that "There's been zero increase in average income, and Pakistan never got out of the balance of payment (bop) crisis.