Large industries record healthy growth of nearly 10% By Shahbaz Ran

[Shahzaz ud din]

Large industries record healthy growth of nearly 10%
By Shahbaz Rana
Published: February 15, 2020
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Current trends suggest that the government will miss its annual growth targets in three major sectors - agriculture, industry and services. PHOTO: FILE

ISLAMABAD: The large industries bounced back last month and posted a healthy growth of nearly 10%, breaking a cycle of constant contraction in past over one year, reported Pakistan Bureau of Statistics (PBS) on Friday.

The large-scale manufacturing (LSM) output increased 9.66% in December over the same month of the last year, according to the national data reporting agency.

This helped to bring the overall cumulative contraction in the LSM sector down to 3.4% during July-December period of fiscal year 2019-20. During five months, the contraction in LSM sector was close to 6%, which significantly came down to 3.4% due to better performance in large industries in December.
Large businesses were bearing the brunt of very high interest rate, documentation drive by the Federal Board of Revenue (FBR) and high energy prices. The growth in the LSM will also help to create jobs if the trend continues in coming months.

In its first quarterly report, the central bank noted that while large export-oriented and import-competing industries remained bullish on fundamentals, they refrained from taking a long-term view.

PBS data showed that out of 15 major industries, eight recorded some growth while the output in seven industries contracted in the July-December period.

Data collected by the Oil Companies Advisory Committee (OCAC) showed that 11 types of industries registered on an average 0.7% negative growth in the July-December period of the current fiscal year. But in December alone, the OCAC-monitored industries reported 0.1% growth.

The Ministry of Industries, which monitors 15 industries, reported 1.8% decline in the growth of these industries. But on a yearly basis, the Ministry of Industries reported 7.4% growth in December over the same month of last year.

Similarly, the provincial bureaus reported 0.9% contraction in 11 industries in first six months of the current fiscal year. On a yearly basis, the provincial bureaus reported 2.2% growth in the month of December.

Sectors that posted growth during first half of the year included textile which grew just 0.32%, fertiliser registered growth of 4.9% and non-metallic mineral products which recorded 2.9% growth. The manufacturing of leather products recorded 11% growth, rubber products 1.3%, wood products 46.6% and paper and board 7.9% in the July-December period. Production of food, beverages and tobacco increased 4.3%.

Industries that were producing seven major types of goods recorded a dip in their manufacturing in July-December 2019. Coke and petroleum products production showed 10.3% growth, pharmaceuticals 6.4%, chemicals 4.1%, automobiles 36.4%, iron and steel products 12.3% and electronics 14%. The engineering products registered negative 1.4% growth.

Current trends suggest that the government will miss its annual growth targets in three major sectors – agriculture, industry and services. The State Bank of Pakistan has recently downward revised its annual growth rate projection to below 3.5%.

Published in The Express Tribune, February 15th, 2020.

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[Shahzaz ud din]

December data shows rebound in large-scale manufacturing
The Newspaper's Staff ReporterUpdated February 15, 2020
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The LSM index jumped by 9.66 per cent year-on-year in December 2019. — Dawn/File
ISLAMABAD: Pakistan’s large-scale manufacturing (LSM) output revived in December, posting growth after declining in eight consecutive months.

The LSM index jumped by 9.66 per cent year-on-year in December 2019, the Pakistan Bureau of Statistics (PBS) reported on Friday.

Compared to November, the LSM index surged by 16.4pc during the month under review. The resurgence in industrial growth is expected to send a positive signal and help accelerate the sluggish economic growth projected in the current fiscal year.

The latest monthly increase was mainly led by 41.57pc growth in food and beverages, 33.4pc in paper and board and 16.1pc in leather products.

However, during July-December 2019, the LSM contracted by 3.35pc from a year ago.

In 2018-19, the big industry had decreased by 3.64pc versus a target growth of 8.1pc, which for the ongoing was fiscal year had been set at 3.1pc.

Sector wise, production of 11 items under the Oil Companies Advisory Committee edged up by 1.23pc, 36 items under the Ministry of Industries and Production went up by 10.69pc while 65 items reported by the Provincial Bureaus of Statistics inched higher 8.6pc.

The extended downward trajectory of LSM contributed to the overall economic slowdown, as the State Bank of Pakistan estimated the economy to grow by 3.5pc in 2019-20.

LSM constitutes 80pc of the country’s total manufacturing and accounts for nearly 10.7pc of the national output.

In comparison, small-scale manufacturing accounts for just 1.8pc of GDP and 13.7pc of secondary sector.

The auto sector, which has seen massive decline in sales over the last few quarters, witnessed multiple upward price revisions due to currency depreciation, which kept potential buyers at bay. On a yearly basis, it registered sales decrease in almost all variants during the first half year of the ongoing fiscal year.

The production of tractors dipped by 54.74pc, trucks 41.45pc, buses 25.68pc, jeeps and cars 37.14p, LCVs 67.57pc and motor cycles 3.48pc.

Pharmaceutical also suffered due to a considerable lag in regulatory adjustments in prices, which in addition to the weakening of rupee added to the distress of the import-dependent sector.

As a result, the production of syrups declined by 4.20pc, and tablets 0.9pc. However, the production of injections increased by 1.14pc and capsules by 368pc during December.

Similarly, sugarcane output has increased by 97.14pc in December from a year ago. Among non-metallic mineral products, cement was up 7.93pc in December, led by increase in construction activity.

Moreover, production of cooking oil and vegetable ghee went up by 11.20pc and 13.57pc respectively. However, blended tea production fell by 31.94pc.

According to the Annual Plan 2019-20, the industry output is expected to expand with the implementation of envisaged policy measures. It anticipates private sector investment to lead the revival of economic activity with the help of necessary regulatory support.

Published in Dawn, February 15th, 2020

 

[Syed1.]

Ya Allah please have your mercy on patwaris. Buray din ahrahay hain inkay.