ISLAMABAD: Large-scale manufacturing (LSM) grew 9.7 per cent year-on-year in April, the second-highest monthly growth recorded in the past few years.
However, annual growth during the July-April period stood at 5.6pc, according to data released by the Pakistan Bureau of Statistics on Friday.
Manufacturing is the backbone of Pakistan’s economy and is the second-largest sector. It consists mainly of large-scale manufacturing that has a share of 80pc within manufacturing and 10.7pc in overall GDP. Small-scale manufacturing accounts for 1.8pc in GDP and 13.7pc within manufacturing.
The production data of 36 items received from the Ministry of Industries and Production and that of 65 items received from the provincial bureaus of statistics contributed to LSM growth by 4.4pc and 1.08pc, respectively.
However, the production data of 11 items received from the Oil Companies Advisory Committee contributed slightly to LSM growth by 0.10pc in April.
The official industry-specific data shows that in April iron and steel products recorded the highest growth of 53.3pc, followed by food and beverages 33.6pc, engineering goods 30.6pc, coke and petroleum products 13.5pc, automobiles 11.5pc, pharmaceuticals 8.9pc, paper and board 4.2pc, rubber products 2pc, non-metallic mineral products 1.9pc, wood products 1pc and textile 0.7pc.
Other sectors that showed a decline included fertilisers 9.6pc, leather products 8.7pc, electronics 3.5pc and chemicals 0.3pc.
The LSM sector also benefitted from the continued improvement in the supply of electricity and gas coupled with the expansion in credit to the private sector.
The expansion in credit to the private sector remained high due to lower cost of credit and better market conditions. A welcome development was the rise in net credit disbursement for fixed investment.
Sectors-specific data shows that growth in the iron and steel sector mainly came from rising production of billets/ingots (up 88pc) and hot and cold rolled sheets, strips and coil (up 27pc).
Robust construction activities also led to an increase in demand for steel and allied products. The improved energy supply and recovery in global prices provided room to local players to increase their prices which ultimately helped them to boost their capacity utilisation.
The cement sector recorded a growth of 2.1pc.
Production of food, beverages and tobacco recorded the second-highest growth in April over the last year on account of a rise in sugarcane crop over last year by 329pc, rising domestic prices and wide usage of ethanol in power generation by manufacturers.
The other items which recorded positive growth are juices, syrups and squashes whose production rose by 10.2pc, blended tea 7pc and cooking oil 7.3pc.
In the engineering sector, the production of diesel engines increased by 167pc and safety razor blades by 0.16pc.
In the automobile sector, tractors’ output grew 36.2pc, trucks 38.7pc, jeeps and cars 7.8pc and motorcycles 17.2pc in April. However, the production of light commercial vehicles fell by 3.4pc after the end of Punjab government’s Apna Rozgar scheme. Bus production dropped 44pc.
In the pharmaceutical group, capsules, injections, liquids/syrups and tablets posted growths of 1.5pc, 20pc, 3pc, and 11.4pc, respectively.
The production of coke and petroleum products went up 13.5pc year-on-year in April, mainly because of increase in the production of motor spirits 27.7pc, high-speed diesel 16.3pc, diesel oil 162pc, furnace oil 22.5pc, lubricating oil 4.3pc, jute batching oil 52pc and liquefied petroleum gas 21pc.
However, the production of jet fuel dropped by 3.6pc, kerosene 6.5pc, and solvent naphtha 20c.
Published in Dawn, June 17th, 2017