ISLAMABAD — Pakistan’s fragile democracy reached a milestone on Saturday when the government stepped down at the end of its five-year term, setting the stage for elections due to take place by mid-May.

The action was a first in a country where the powerful military has regularly ousted civilian governments, either directly through coups or indirectly through constitutional maneuvers, and it offered hope that the parliamentary system was maturing.

Still, a faltering economy and widespread militant violence have left many Pakistanis grumbling about the lack of tangible dividends from democracy, and the governing Pakistan Peoples Party, whose performance has been widely criticized, will face a strong challenge from the opposition leader, the former Prime Minister Nawaz Sharif.

In a televised address to the nation that was heavily steeped in his party’s history, Prime Minister Raja Pervez Ashraf defended his government’s record. Talks with the opposition over the formation of a caretaker administration, which would run the country until the elections, were continuing, he said.

A peaceful transfer of power to a new government would be a political victory of sorts for President Asif Ali Zardari, the party co-chairman, who has confounded regular predictions of the demise of his government over the past five years. A good showing by his party in the election may help him win re-election when his terms expires next September. (Pakistan’s president is indirectly elected by the national and regional assemblies).

Recent polls indicate that the party of Sharif, who was ousted in a military coup in 1999, is the favorite to win the vote, with the Pakistan Peoples Party running a distant second. Since analysts say he is unlikely to muster an outright majority, a range of ethnic, regional and religious parties could hold the balance of power in determining a coalition government.

Other personalities and factors are also expected to play a role. The cricketer-turned-politician Imran Khan, who has campaigned heavily against corruption and in opposition to U.S. drone strikes, hopes to eat into Sharif’s support base in Punjab province, which accounts for over half of the 272 elected seats in Parliament.

The political system last week was gripped by speculation about the identity of the caretaker prime minister, who will lead an interim administration in the prelude to the elections.