The United States on Tuesday warned that Pakistan's move towards democracy has been seriously set back by the emergency, which could also hit the investor confidence in the country.
"The US is urging your government not to throw away in weeks what it has taken years to achieve," American Ambassador to Pakistan Anne W Patterson said.
Noting that Pakistan's move towards democracy has been seriously set back by the emergency, she said: "Our embassy and our consulates have tried to make sure that American business representatives know that Pakistan is a good place to do business and I have always highlighted the enormous economic opportunities which your country offers."
Speaking at the National Defense University in Islamabad, Patterson said Pakistan's economic progress, particularly the seven per cent annual economic growth, has been one of the greatest accomplishments of President Pervez Musharraf's administration.
Patterson's comments came ahead of a visit by US deputy secretary of state John Negroponte to Pakistan this week to urge Musharraf to end the emergency before the polls in January.
"The imposition of a state of emergency puts this economic growth of Pakistan and upward mobility at risk. This is an ominous development," she said.
Anecdotal evidence indicates that US investors have adopted a wait and see attitude now, Patterson said, adding that the longer the extra-constitutional measures stay in place, the greater the long-term damage to Pakistan's economy.
Patterson said for the general election to be credible, the government must release opposition leaders and workers from jail or house arrest and the media must be free to report on events and criticise the administration.
"One of President Musharraf's greatest achievements was the flowering of a free and vibrant media. There is no way to put this genie back in the bottle by cutting off the media now," she said.
"Our bilateral relationship now encompasses a broad range of shared interests that go beyond security," Patterson said.
"Pakistan must tackle the extremists and militants operating within its borders to continue its economic progress and protect the right of the Pakistani people to choose how they live their lives," she urged.
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