ISLAMABAD: The large-scale manufacturing (LSM) sector shrank 10.63 per cent during March from a year ago, the Pakistan Bureau of Statistics (PBS) reported on Wednesday.
It was attributed to dismal performance of food and beverages, fertilisers, petroleum products and automobiles sending fears of large-scale layoffs in the industrial sector.
On a year-on-year basis, the LSM dipped by 2.93pc during the first nine months (July-March) of this fiscal year —so far in negative and far behind the target of 8.1pc set for 2018-19.
Sector-wise, production data of 11 items from Oil Companies Advisory Committee registered a negative growth of 9.65pc whereas 36 items received from the Ministry of Industries and Production and 65 items by provincial bureaus of statistics declined by 11.90pc and 7.39pc, respectively.
Industrial sector is targeted to grow by 7.6pc during 2018-19. Manufacturing sector is projected to expand by 7.8pc with LSM growth rate of 8.1pc, small-scale and household manufacturing 8.2pc, construction 10pc and electricity generation and distribution and gas distribution by 7.5 pc.
The performance show that the economy will slow down further following the negative growth in the LSM in the first nine months of the current fiscal year. The government has recently projected that the economy will grow by 3.3pc in the year 2018-19.
The industrial sector was expected to get boost from improved energy supply, public sector expenditure and the mega-initiatives under the China-Pakistan Economic Corridor to develop infrastructure, energy resources, roads, railways and bridges.
LSM constitutes 80pc of manufacturing and 10.7pc of the overall GDP. In comparison, small-scale manufacturing accounts for just 1.8pc of GDP and 13.7pc in manufacturing.
Pharmaceutical — dipped 6.14pc year-on-year during March 2019 — declined mainly due to a 2.16pc decrease in the production of syrups, capsules 56.4pc. However, tablets, and injections went up by 6.35pc, and 3.83pc, respectively.
The government has recently allowed increase in the price of pharmaceuticals. However, the government has reversed the decision following criticisms from all quarters including opposition parties.
In the non-metallic mineral products, cement dipped 11.93pc in March over same month last year. The sugar production has dipped by 26.49pc during the month under review.
On a year-on-year basis, almost all vehicles in the auto sector posted decline in March. Tractor production went down by 20.03pc, light commercial vehicles 34.47pc, trucks 57.67pc, buses 30.88pc, jeeps and cars 10.02pc and motorcycles 23.32pc during the period under review.
Decline in the chemical sector was mainly driven by a dip in the production of paints and varnishes by 2.22pc; whereas caustic soda production went down by 18.23pc. Moreover, the production of vegetable ghee, cooking oil and tea blended dipped by 3.57pc, 10.75pc, and 17.57pc, respectively.
Published in Dawn, May 16th, 2019