Industrial output continued with the upward trend for the third consecutive month as Large-Scale Manufacturing (LSM) grew by a robust 68.07 per cent in April, reflecting phenomenal growth in industrial output, data released by the Pakistan Bureau of Statistics (PBS) showed on Saturday.
The surge in April is in stark contrast compared to the period last year when the Covid-19 lockdown — which came into effect on March 23 — led to a startling slump in production activities.
On a month-on-month basis, the big industry production contracted by 6.99pc. LSM expansion had slowed in January after posting a double-digit growth in December and November on the back of higher automobile and cement production and one-time sugar output, which reflects the revival of industrialisation.
Since February, LSM has rebounded and posted growth in the following months.
During the first 10 months of the current fiscal year (10MFY21), LSM grew by 12.84pc. Since July 2020, LSM has rebounded after suffering months of a downturn on account of the Covid-19 pandemic situation mainly in the automobile, construction, textile, food, chemicals, non-metallic mineral products and pharmaceutical sectors. The uptick during the 10MFY21 reflects a revival in economic activities.
Low interest rates, reduction in duties on raw materials spurred economic activities
The PBS snapshot of manufacturing activity showed that 14 out of 15 sub-sectors in LSM rose during the month under review. Low interest rates and reduction in duties on raw materials are expected to further spur economic activities during the current fiscal year.
Sector-wise, production of 11 items under the Oil Companies Advisory Committee was up by 85.76 per cent year-on-year in April. The 36 items under the Ministry of Industries and Production rose by 99.67pc, while 65 items reported by the provincial bureaus of statistics were up by 24.12pc.
LSM at 9.73pc of GDP dominates the overall manufacturing sector, accounting for 76.1pc of the sectoral share. It is followed by Small Scale Manufacturing which accounts for 2.12pc of total GDP and 16.6pc sectoral share.
According to the Pakistan Economic Survey 2020-21, despite the issues raised in the ongoing Covid-19 pandemic, manufacturing sector remained sound and resilient during FY21 on the back of well in time government initiatives.
It further said the government’s thoughtful decision to resume business activities and adoption of smart lockdowns boosted sentiments and the economy gained traction after witnessing a hefty decline in FY20.
Targeted fiscal and monetary incentives accompanied by related support packages helped speed up economic recovery. The situation was further improved by depreciation of the US dollar against the rupee and launch of Covid-19 vaccination campaign in the country.
As per the PBS data, the entire automobile sector showed strong growth in 10MFY21 compared to the same period from a year ago. Production of tractors rose by 65.26pc, trucks 2.56pc, buses 4.33pc, jeep and cars 41.61pc, LCVs 45.93pc and motorcycles by 33.39pc during the months under review.
Cement output also grew by 25.36pc during the 11 months under review on the back of greater demand following the start of construction activities and increase in exports. In the steel sector, billets and ingots also posted a growth of 48.62pc. The production of paints and varnishes was up 73.25pc. Cigarettes production posted a growth of 19.76pc.
In pharmaceuticals, the output of syrups rose by 24.25pc, injection 24.88pc, and capsules 26.55pc. However, the output of tablets dipped by 1.33pc and ointments 9.57pc.
On the other hand, vegetable ghee production rebounded and posted a growth of 1.52pc, cooking oil 3.04pc and tea blended 5.91pc while wheat and grain milling output dipped by 6.88pc.
The PBS data for April showed that output of petroleum products was up by 17.52pc across the board. The output of two oil products — petrol and high-speed diesel — was up 139.17pc and 68.34pc, respectively, whereas furnace oil production increased by 76.68pc, jet fuel oil 163.95pc and LPG by 33.30pc.
Production of kerosene was up by 110.49pc. Production of other petroleum sub-products increased during the month under review.
In electronic goods, the output of refrigerators posted a growth of 1,786pc, deep freezers 1,019pc, air-conditioners 1,100pc, electric bulbs 16.33pc, electric fans 2,616pc, electric meters 580pc, TV sets 156pc and electric transformers 111pc. Other electronic goods output also posted positive growth during the month under review.