ISLAMABAD: Faced with energy shortages Pakistan’s Large-Scale Manufacturing sector grew by a just 1.17 per cent in 2011-12 slightly higher than the 1.14 per cent growth the sector posted in 2010-11.

The slump in LSM production occurred on the back of decline in production of iron and steel products, petroleum products and electronics that pulled down the overall growth in the sector, suggested data of Pakistan Bureau of Statistics issued here on Wednesday.

The performance of the manufacturing sector had been a boom bust phenomenon in 2011-12. The fluctuations in growth accrued as a result of three main pushing factors: energy crisis, rising input cost and lack of demand in domestic and international market.As a result of slowdown in the overall manufacturing sector especially LSM, which accounts for more than 70 per cent of industrial output, the economy is also expected to grow by about 3.7 per cent in 2011-12.

For the past few years, the industrial production had been declining owing to capacity constraints and closure of many units as a result of high cost of doing business and lack of policy to promote industrialisation.

Experts say lower demand and restraints on supply side has affected the industrial growth during the fiscal year under review. However, the major positive contribution towards modest growth performance came from durables like growth in food beverages, pharmaceuticals, non-metallic mineral products, paper and board, textile, automobiles and fertilisers.

Despite prolonged de-industrialisation which is still continuing, the government is not yet clear whether to implement its National Industrial Policy 2011 or do away with it. The draft policy was approved in May 2011.

The policy document is a good piece of research which comes up with some ambitious targets like eight per cent industrial growth per annum (with interrupted power and gas supply), creation of more than four million new jobs and 100 per cent value addition in the manufacturing sector. It further claims the policy would turn Pakistan into a ‘world factory’ rather than a ‘shop’ in next 10 years.

Industry-specific data showed that many sub-sectors didn’t perform well in 2011-12 mostly electronic goods which led to jump in imports of consumer and electronic goods during the fiscal year.

In the electronic and electrical goods, production of deep-freezers fell by 35.37 per cent, air-conditioners 6.50 per cent, electric bulbs 0.93 per cent, electric fans 4.36 per cent, electric motors 12.38 per cent, electric meters 11.69 per cent, switch gears 31.89 per cent, TV sets 36.84 per cent, storage batteries 17.13 per cent and bicycles 24.14 per cent during the last fiscal year.

However, refrigerators recorded a growth of 7.69 per cent, electric tubes 7.29 per cent, electric transformers 72.98 per cent and generating sets 87.95 per cent, respectively.

The textile sector, which has an adjusted weight of 32.6 per cent in the LSM basket, recorded growth. Only cotton yarn and cotton cloth (both semi-finished products) succeeded to improve with 0.52 per cent and 0.30 per cent, respectively.

Other segments of textile industry posted negative growth like knitting wool declined by 10.80 per cent, and woollen and carpet yarn 20.03 per cent.

The best growth was witnessed in case of food, beverages and tobacco. The sector had adjusted weight of 19.1 per cent in LSM basket. Vegetable ghee grew by 1.46 per cent, cooking oil by 5.24 per cent, tea blended 14.97 per cent, and wheat 3.90 per cent, beverages 21.53 per cent, and juices, syrups 29.65 per cent and sugar production up by 11.16 per cent.

Another important sector, which provides jobs to a larger chunk across the country, is the automobile sector. However, tractors production dropped by 32.04pc, trucks 7.58pc during 2011-12 over the previous year.

However, buses production up by 15.92pc, jeeps and cars 14.72pc, LCVs up by 9.34pc and motorcycles 0.43pc, respectively.