Industrial output falls 4.12pc in December: Growth target in jeopardy
By Mubarak Zeb Khan
ISLAMABAD, March 17: Industrial output declined by 4.12 per cent in December 2007, compared to the same month last year, according to data issued by the Federal Bureau of Statistics on Monday.
The decrease raised fears that the target of annual industrial growth may not be achieved.Energy crisis and reduced working days, owing to strikes in the wake of assassination of former prime minister Benazir Bhutto, have been attributed as major factors for this slump in production.
Analysts said that negative growth in industrial production has dampened chances of a reversal in the industrial growth in the months ahead, to achieve a 10.5 per cent growth target.
Industrial growth, as measured by quantum index numbers, showed that all major sectors, like manufacturing, mining and electricity, registered a slide in production growth.
This also resulted in the further widening of a gulf between demand and supply issue.
The growth in the industrial production has steadily been on the decline for the last three years as it declined to 8.8 per cent in 2006-07 from 19.9 per cent in 2004-05 owing to capacity constraints and closure of many units as a result of high cost of doing businesses in the country.
An official in the finance ministry, requesting not to be named, said the negative growth was only due to lesser working days in December.
He ruled out the impression that energy shortages led to a drastic cut in the industrial growth.
The industrial production grew by a paltry 4.46 per cent in the first half of the current fiscal year over last year (July-December).
This reduction in industrial output would also affect country’s exports which are now unlikely to reach the target of $19.2 billion.
According to the FBS figures, the production of cigarettes decreased by 11.25 per cent, while cotton yarn output grew by 3.55 per cent and cotton cloth production 2.73 per cent in December 2007 this year over last year.
In the food sector, vegetable ghee production declined by 10.94 per cent, cooking oil production by 4.81 per cent and starch and its products by 5.24 per cent.
However, wheat production grew by 0.10 per cent, beverages 19.82 per cent.
Among the electrical items, refrigerators recorded a negative growth of 5.18 per cent, deep freezers 23.89 per cent, electric bulb 5.56 per cent, electric tubes 0.60 per cent, electric motors 8.8 per cent, electric meters 56.96 per cent and transformers 42.89 per cent.
However, production of air-conditioners went up by 47.76 per cent, electric fans by 31.51 per cent, switch-gears by 58.02 per cent, TV sets 43.43 per cent and bicycles 0.80 per cent.
Production of paper and board also dropped by 1.81 per cent, petroleum products by 26.62 per cent and cement by 4.94 per cent in December 2007 over last year.
Production of glass-sheets declined by 13.47 per cent, billets by 6.57 per cent and HR sheets by 50.56 per cent during the period under review over last year. However, steel products witnessed a growth of 32.13 per cent in December 2007 over last year.
