Caution Warranted Despite 4.1% Growth Estimate

With growth estimated to have come in at 4.1% in FY2009/10, the Pakistani economy is showing increasing signs of ongoing recovery. However, despite this flash estimate we remain cautious on the prospect of a return to the booming growth enjoyed through the middle of the last decade. Indeed, Pakistan remains beset by challenges such as a destabilising insurgency and chronic lack of electricity generation capacity - both likely to prove medium-term hurdles to sustained economic development.

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