The State Department said Thursday it expects continued progress in Pakistan toward democratic rule, showing no concern about moves to allow President Pervez Musharraf (searchto remain on as army chief.

The Bush administration had welcomed a pledge by Musharraf in December 2003 to retire from the Army by the end of this year. Such a step would have projected a shift toward civilian supremacy.

Asked directly whether the administration believes that Musharraf should quit his Army post, State Department spokesman Richard Boucher said, "Our view is that Pakistan needs to continue to make progress toward democracy. Whether he takes the specific step is something that's going to have to be decided in Pakistan."

Musharraf's intention to remain in the military became evident when his government pushed through a law allowing him to remain as army chief.

The administration considers Musharraf one of its most important allies in the fight against terrorism and admires his leadership in guiding his country away from Islamic fundamentalism.

Boucher indicated that the administration believes Pakistan can restore democratic governance.

"We are urging Pakistan to continue to make progress on its transition to a full and sustainable democracy, with free and fair multiparty parliamentary elections as scheduled in 2007," Boucher said.