Pakistan - Country history and economic development



1930. The idea of establishing a separate state for all Muslims of South Asia is conceived by the poet-philosopher Allama Muhammad Iqbal.

1947. On 14 August, the British divide the crown colony of India into 2 territories: the Republic of India and the future Islamic Republic of Pakistan, essentially establishing separate Hindu and Muslim states. Several millions of Muslims and Hindus are killed in sporadic fighting between the 2 groups as people migrate across the border into the country aligned with their religious affiliation.

1948. On 30 July, Pakistan signs the General Agreement on Tariffs and Trade (GATT), an agreement aimed at regulating international trade.

1950s-60s. Pakistan uses military and economic aid from its Cold-War alliances to create an artificial prosperity.

1970-71. Zulfikar Bhutto's Pakistan People's Party (PPP) wins elections in West Pakistan, while the Awami League wins the overall majority due to its clear victory in East Pakistan. After the ensuing civil war, East Pakistan declares its independence as the People's Republic of Bangladesh. Bhutto becomes prime minister of the remaining Pakistan.

1970s. The 1970s oil boom in the nearby manpower-starved Persian Gulf enables Pakistan to export manpower in large numbers. Money from Gulf workers transferred home to Pakistan in large amounts helps to sustain the economy in the 1970s.

1977-79. The chief of army staff, General Zia-ul-Haq, overthrows Bhutto in a military coup on 5 July 1977 and becomes president in 1978. Bhutto is executed in April 1979.

1980s. Pakistan's opposition to the Soviet invasion of neighboring Afghanistan in late 1979 helps it procure heavy doses of financial aid from Western nations also opposed to the Soviet action. However, when the aid dries up with the end of the Cold War towards the close of the decade, Pakistan's economy becomes saddled with huge amounts of foreign debt .

1988. Pakistan returns to democratic rule after Zia-ul Haq dies in an airplane crash. The country once again comes under the rule of the Pakistan People's Party, now led by Bhutto's daughter, Benazir. The constitution is restored with some amendments on 30 December.

1996-97. The Bhutto government is dismissed by the president due to charges of corruption, mismanagement, and involvement in extra-judicial killings. Elections in February 1997 result in an overwhelming victory for the Pakistan Muslim League and Nawaz Sharif, who becomes prime minister.

1998. In May, India and Pakistan both conduct nuclear tests, demonstrating their strength and bringing the region to the verge of nuclear war over the disputed Kashmir province. The ensuing international economic sanctions and the related drying up of most capital inflows lead to severe financial difficulties.

1999. The government of Sharif is overthrown by the chief of army staff, General Pervez Musharraf, who jails Sharif and declares himself chief executive of the state. The supreme court validates the military coup against Sharif but restricts the rule of the chief executive to a period of 3 years.

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