KARACHI, Dec 29: Capacity utilization of various industries increased by about 3.2 to 25.8 percentage points in the first quarter of this fiscal year i.e. between July-September 2004
, according to the State Bank's first quarterly report released here on Wednesday.
The report says that capacity utilization increased "in response to rising demand in the economy." Quoting data compiled by the Ministry of Industries and Production, the SBP report says that electronics industry posted the highest increase of 25.8 percentage points in capacity utilization.
This industry utilized 65.8 per cent of its installed capacity in the first quarter of this fiscal year. In the first quarter of the last fiscal year it had utilized only 40 per cent of its installed capacity.
The report says the automobile industry that had utilized 52.8 per cent of its capacity in Q1FY04, used 76.5 per cent capacity in Q1FY05-showing an increase of 23.7 percentage points.
Commenting on the increase in capacity utilization by electronics industry, the SBP report says that substantial idle capacity is still available in the air conditioners manufacturing industry. It says that there is a need to enhance the installed capacity in refrigerator industry as the utilization has already surpassed 100 per cent by the end of Q1FY05.
The report says that within the automobiles industry, the capacity utilization in tractors manufacturing witnessed the largest increase of 44 percentage points, followed by motorcycles, scooters, light commercial vehicles or LCVs and cars and jeeps.
Since capacity utilization in motorcycle and tractor industries has reached about 112.3 per cent and 113.9 per cent respectively, manufacturers plan to expand production capacity during this fiscal year.
Cement industry's capacity utilization increased to 89.2 per cent in the first quarter of this fiscal year from 73.1 per cent in a year-ago period, showing a growth of 16.1 percentage points.
The SBP report notes that many cement manufacturers have plans to expand their production capacities significantly during this fiscal year, despite the fact that the capacity utilization of this industry has reached 89.2 per cent.
Petroleum refining recorded an increase of 16.3 percentage points in Q1FY05 when the capacity utilization of this industry reached at 110.5 per cent, up from 94.2 per cent in Q1FY04.
There is a need to expand its capacity in future to meet the rising demand of petroleum products. Fertilizer industry recorded the lowest increase of 3.2 percentage points in capacity utilization in the first quarter of this fiscal year during which period it utilized 46.5 per cent of its capacity, against 43.3 per cent in a year-ago period.
Vegetable ghee & cooking oil industry saw a modest decline in capacity utilization in Q1FY05. This industry utilized 38.9 per cent of its capacity in July-September 2004, down from 39 per cent in July-September 2003.
