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Key Economic Data 
 
  2004 2003 2002 Ranking(2004)
GDP
Millions of US $ 96,100 82,300 73,300 44
         
GNI per capita
 US $ 600 520 480 160
Ranking is given out of 208 nations - (data from the World Bank)

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Update No: 015 - (26/04/07)

US pressure begins to have impact
President Bush is reportedly using the threat of a Congress under Democratic control to scare Musharraf into delivering the goods, both as far as relations with Afghanistan and Pakistan’s internal affairs are concerned. The Democrats have a tradition of not being very friendly with Pakistani military regimes and Musharraf knows that, although in fact many Republican congressmen are among the angriest at what they see as Musharraf’s betrayal. The recent wave of infighting in Waziristan, involving rival tribes one of which is allied with Uzbek militants close to Al-Qaida, might be related to such growing US pressure. Soon, Pakistani troops were fighting on the side of the tribe opposed to the Uzbeks. This allowed Musharraf and the government to claim this development as a major victory and a vindication of their strategy of appeasing the Pakistani Taliban, although other observers are more sceptical. With regard to Afghanistan itself, there are too some signs of movement on the Pakistani side, hinting at a compromise solution which might lead to dropping the Taliban but also to empowering other pro-Pakistani factions, although any deal is still far off.

The internal front gets more complicated
On the Pakistani internal front, pressure from abroad combines with internal pressure. In March, 7 Pakistani judges resigned in solidarity with the chief justice. Politicians of the ruling party, the Pakistan Muslim League, are already beginning to distance themselves from the President, having perceived that Musharraf’s popularity is declining fast and knowing that elections are due soon. Negotiations between Bhutto and the government are known to be taking place. The possibility of Musharraf accepting to drop the position of chief of staff of the armed forces while remaining president appears no longer so remote. Bhutto’s PPP would then accept him as president in exchange for clean parliamentary elections in 8-9 months. Such a solution would meet US demands. In a gesture of détente, the Pakistani authorities in March eased the restrictions against the sacked chief justice and sacked some policemen guilty of storming a private news channel which had criticised the government. Then in April charges against Benazir Bhutto were dropped and she was declared free to return to Pakistan, a move widely interpreted as a sign that negotiations with the PPP were fairly advanced. 

The temptation to keep going
However, it is far from clear yet how the crisis will end. According to some sources, Pakistan’s three powerful security services are divided on how to approach the situation. While the ISI reportedly advises caution and an opening to opposition political parties, the Intelligence Bureau and the Military Intelligence push for the adoption of a harder line. Many among Musharraf’s supporters and advisers believe that if he leaves the uniform, his power will evaporate. This is also his own personal opinion as he expressed it in his memoirs. Many believe that Musharraf will not have much trouble in maintaining control of the army should he opt to go on as President and Chief of Staff, as he appointed almost every general. Military criticism tends to come from retired officers. Musharraf has at least on his side the fact that the Pakistani economy keeps doing well. The latest estimates by Merrill Lynch see GDP growth at 7% this year and the next, corporate tax collection is up 69% and foreign private investment 147%. Musharraf will probably be able to afford a few ‘presents’ to endear himself to some sectors of the population. It was recently announced that corporate tax will be reduced from 35% to 32% this fiscal year.

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