Pakistan’s large-scale manufacturing industries’ (LSM) output rose by 9.13pc in January from the prior year. The index of LSM was up by 5.36pc in January from December, according to the Pakistan Bureau of Statistics (PBS). This is the second monthly expansion recorded in FY21 as its economy continued to recover post the pandemic.
On January, 9 out of 15 sub-sectors of large-scale manufacturing rose. Low-interest rates and reduction in duties on raw materials are expected to further spur economic activities in the current fiscal year. In December and November, LSM grew by 11.4pc and 14.5pc from the prior year, respectively. January marked the fifth successive month rise in industrial activity since September.
LSMI constitutes 80pc of Pakistan’s total manufacturing capacity and accounts for more than 10pc of the country’s overall output. In comparison, the small-scale industry makes up for 1.8pc of GDP and 13.7pc of the secondary sector.
Auto and cement production up in January
In January, the automobile sector posted massive growth from the prior year. Production of tractors rose by 428.7pc, buses 34.21pc, jeep and cars 27.38pc, LCVs 86.95pc, and motorcycles 4.38pc during the month under review. The production of trucks dipped 46.29pc.
With the start of construction activities season and an increase in exports, cement output also grew 38.10pc on the back of greater demand in January.
The overall output of LSMI increased by 7.85pc for the July-January period compared to the prior year period.
During July-January, major manufacturing sectors, automobile showed 13.02pc growth, while iron and steel products registered a decline of 1.06pc from the same period the prior year.
Imports of steel, however, dropped in February as end-users focused on domestic products amid high-priced overseas offers. Many mills were still constrained by cash flow issues due to delays in project payment cycles. Post-January, Pakistan’s industry is gradually recovering from a slump in production during winter. But the pace of construction and transportation sectors remains slower-than-expected dampening steel consumption.