According to a report of the Pakistan Bureau of Statistics, the large-scale manufacturing sector has improved its performance during the first two months of the current fiscal year.The growth of the sector shot up to 11.3 percent in two months after posting a 5.7 percent growth last year which was the highest in a decade.The growth in the last fiscal year is attributed to the factors driven by the domestic demand. However, the export-led demand is likely to spur industrial growth during the current fiscal year.The report notes that growth in the export sector rose to around 10.84 percent over the same period of the last fiscal year as demand for petroleum, pharmaceuticals, chemicals, leather and engineering products increased. According to experts, the optimism could evaporate in case of political turmoil, law and order situation, load shedding and lack of soft bank loans. With increase in population, demand of products has increased at home and abroad. But the industry still lacks vision to invest in capacity building of its employees. Another assessment by the states bank reveals the industry could achieve a growth target of 6.3 percent for the fiscal year 2017-18 if direct foreign investment continues to flow into the country.
During the last fiscal year, at least 12 out of a total of 15 broad industrial categories recorded a higher output and the trend has apparently been consolidated during the first two months of this year. The experts also attribute the last year’s growth to higher public sector spending in construction and infrastructural projects, bank loans to the private sector at low interest rates and improved supply of gas and electricity to industrial units. A good segment of middle and upper middle class has the purchasing power to create demand at local level whereas as exports are also picking up after a four-year slump. The performance of the textile sector is satisfactory which can have good impact on the large manufacturing sector as it depicted a growth of eight percent during the current fiscal year. The report indicates that food, beverages and tobacco sectors are likely to perform well during the current fiscal year as they posted a double-digit growth last year. However, the political chaos and law and order can subdue the performance and the government will have to maintain political and administrative order to continue the growth of the sector unhindered.
