He said Pakistan and the US have enjoyed historically close friendship, but "some reservations did develop in people's minds regarding the nature of cooperation".
As such Pakistan sought continued US cooperation for its economic, security and social development on the basis of its friendship based on mutual interests and democratic principles.
"For long lasting close relations this friendship should be based on mutual interests and democratic principles," said Sharif.
Sharif said during the last seven years, Pakistan's national institutions had been made dysfunctional, which had contributed towards internal crisis.
US House of Representatives sub committee on National Security and Foreign Affairs, led by Chairman John Tierney, assured Sharif that they would stress upon the Bush administration to ascertain holding of free and fair elections and the participation of the entire political leadership in them.
"Strengthening democratic governance and national institutions is our top most priority so that Pakistan progresses as a democratic nation," The Nation quoted Tierney as saying.
"Congress is considering proposals to link Pakistan's economic assistance with progress on fighting terrorism and restoration of democracy. In this connection the delegation will meet with the representatives of the government, political parties, and civil society to formulate its recommendations," he said.
Tierney said General Musharaf played extremists threat only to perpetuate his rule whereas the people of Pakistan had always supported moderate parties and ideas.
Sharif added that General Musharraf had always portrayed a negative image of Pakistan by empowering the extremists to use them as a bargaining tool with the west.
"The year 2007 is a defining year for Pakistan. If elections are rigged, the country will plunge into deeper political crisis. The opposition parties are committed to restoring supremacy of constitution, rule of law, and ensuring fair and free elections in the country," said Sharif.