Large scale industrial output expands 7.45 percent in eight months of current fiscal year

Large Scale

Large Scale Manufacturing increased by 4.85 percent in the month of February making it to an increase of 7.45 percent for July-February 2020-21 compared to July-February 2019-20 according to the data released by the Pakistan Bureau of Statistics.

Large Scale Manufacturing (LSM) represents 80 percent of the total manufacturing and accounts for 10.7 percent of the Gross Domestic Product (GDP). The small-scale industry contributes 1.8 percent of the GDP and 13.7 percent of the secondary sector.

On a month-on-month basis, large-scale manufacturing contracted by 4.15 percent. It decreased in January after posting double-digit in December and November on the back of the higher automobile, cement product, and one-time sugar output which shows the revival of industrialization.

During the months of December and November 2020, the large Scale Manufacturing raised by 11.4 percent and 14.5 percent on a year-on-year basis. The LSM surpassed its pre-Covid-19 level of production in January, showing a 9.1 percent increase on a year-on-basis (negative 5.7% in January 2020) while on a month-on-month basis it grew by 5.4 percent in January 2021 (13.4% December 2020).

During July-January 2020-21, the Large Scale Manufacturing increase by 7.9% against a 3.2% contraction the previous year. Since July 2020, Large Scale manufacturing rebounded after suffering a long downturn on account of Covid-19, especially in construction, textile, food, chemical, non-metallic mineral products, automobile, and pharmaceutical sectors.

The period of the first eight months of the current fiscal year shows the revival of economic activities in the country. 8 out of 15 sub-sectors in large scale manufacturing grew during this period. Low-interest rates and reduction in duties on raw materials will cause further increase the economic activities during the same fiscal year.

Sub-sectors excluding trucks and buses within the automobile sectors showed big growth in February from a year ago. Production of tractors increased by 42.47%, jeep and cars 37.24%, LCVs 37.19%, and motorcycles 16.85% during the month under review. The production of trucks decreased by 17.01 % and buses by 19.70%

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