Economy of Pakistan is the 26th largest economy in the world in terms of purchasing power, and the 47th largest in absolute dollar terms1 . Pakistan’s economy mainly encompasses textiles, chemicals, food processing, agriculture and other industries.   Fiscal year 2008‐09 remained difficult year for Pakistan’s economy. Several political and economic events, both on domestic and external front, occurred unexpectedly. These events include: disturbed political conditions; an unstable law and order situation; supply shocks; soaring oil, food and other commodity prices; softening of external demand; and turmoil in the international financial market. All these events have adversely affected the key macroeconomic fundamentals of Pakistan during the fiscal year 2008‐09. However economy of Pakistan has shown great resilience against internal and external shocks of very high intensity and grew at 4.1 percent in 2008‐09(target was 7.2 percent), as against 6.8 percent last year. Per capita income has grown at an average rate of above 13.0 percent per annum during the last five years, rising from $ 586 in 2002‐03 to $ 925 in2006‐07 and further to $ 1046 in 2008‐09.Total investment declined to 19.7 percent of GDP in 2008‐09 from its peak level of 22.9 percent 2006‐07. Foreign direct investment has shown more resilience and stood at $3,205.4 million during the first ten months (July‐April) as against $3719.1 million in the same period last year thereby showing a decline of 13.8 percent.