KARACHI: Manufacturing output of fertiliser, automobile and pharmaceutical industries continued to expand at a healthy rate in the first two months of current fiscal, keeping Pakistan’s large scale manufacturing (LSM) growth in positive territory.
The overall output of LSMI increased by 1.97 percent for July-August in fiscal year 2016-17 (FY17) compared to July-August of FY16, Pakistan Bureau of Statistics (PBS) reported on Thursday.
The Executive Board of the International Monetary Fund (IMF) said in its final review of Pakistan’s three-year economic reform programme that despite a weak cotton harvest and a continued decline in exports, growth is estimated at 4.7 percent in FY 16, supported by buoyant construction activity and healthy expansion of the service sector. Strengthening domestic demand is also indicated by rising domestic machinery imports. Pakistan has been benefitting from lagged affects of the pronounced fall in oil prices and a marked reduction in domestic interest rates, which has been accompanied by strengthened private sector credit growth. Growth would likely increase moderately to 5 percent in FY17, also supported by an investment upturn related to the China Pakistan Economic Corridor (CPEC).
During the first two months of FY17, the overall output of LSMI increased by 1.97 percent Year on Year (YoY) as only two constituent indices witnessed positive growth and one indice saw negative growth.
Highest contribution was made by Provincial Bureau of Statistics (BOS), with yearly increase of 4.34 percent, while Ministry of Industries (M/I) Index contributed yearly increase in production by 1.70 percent. However, Oil Companies Advisory Committee (OCAC) Index contracted by 5.29 percent YoY.
Moreover, on monthly basis, over all output of LSMI increased by 6.03 percent in August 2016 when compared with July 2016, indexes (OCAC, MoI & BOS) posted mixed growth trends in August as compared to July as OCAC posted 0.87 negative MoM growth while MoI and BOS registered positive growth of 6.14 percent and 0.76 percent respectively.
The sectors showing growth during July-August of FY17 compared to July-August of FY16 were Pharmaceuticals (5.26%), non-metallic products (13.69 %), automobiles (3.60%), iron and steel products (12.91%), fertilserrs (4.01%), electronics (1.86%), leather products (0.77%), paper & board (1.11%) and rubber products (4.39%).
The sectors showing decline during July-August FY17 compared to July-August FY16 were textile (-0.19%) food, beverages & tobacco (-0.40%) coke & petroleum products (-7.25%), chemicals (-5.73%), engineering products (-17.00%) and wood products (-97.78%).