LAHORE: Prime Minister Shahid Khaqan Abbasi on Saturday advised the industrial sector to upgrade technology in order to improve its competitiveness in local as well as international markets.
Abbasi, talking to businessmen at a meeting, said new technology is substantially increasing industrial efficiencies. He admitted that conditions for the manufacturing sector are not ideal, saying the government is, however, making sincere efforts to facilitate the sector.
Prime Minister said the government has at least resolved the energy issues by adding 10,400 megawatts of electricity and 1.2 billion cubic feet/day of gas into the system. “Industrial activities have accelerated as a result of these efforts.”
Manufacturing sector contributes 13.5 percent share to GDP. Large scale manufacturing (LSM), which accounts for 80 percent of the sector, posted a gigantic 9.44 percent year-on-year growth in January on increasing cement and steel consumption and rising auto sales. In the first seven months of the current fiscal year of 2018, LSM grew 6.33 percent, which is equal to the sector’s annual growth target set by the government. Alone in the first quarter, LSM experienced a nine-year highest quarterly growth of 10 percent.
Abbasi said the government is addressing the issue of high cost of doing business by improving governance and expanding tax base. There are several ways of reducing costs of inputs. “Tax reduction is one way,” he said. “Duties cannot substantially be reduced or abolished until the tax net is enlarged. But, we will facilitate manufacturers to the maximum level.”
Prime Minister commended businessmen who are still active in manufacturing despite a fact that profit margins in manufacturing are much lower than margins enjoyed by traders or real estate dealers. Manufacturing sector provides permanent jobs that are needed in the country, he added.
Abbasi said manufacturing sector will become more profitable if it upgrades technologies as well as processes and procedures to reduce operational cost. “Only then the government facilitations would help them get to competitive advantage.”
Prime Minister further said road infrastructure has been revolutionised during the past five years. “We have built 1,700 kilometres of motorways during this government’s tenure which is comparable with the developing countries,” he said. “Even in the United States, it is not possible to construct 300-400 kilometres of motorways in one year.”
Abbasi said the government has kept future needs in consideration while starting electricity projects. “We are trying to bring all the political parties on one page as far as economy is concerned.”
Prime Minister said the economy is now in growth mode and economy size will exceed 5.6 percent this year and six percent next year. He hoped that the next elected government would continue the economic policies to give confidence to the investors.
Appreciating the latest technology introduced by local electric cable manufacturer Fast Cables, Abbasi said the introduction of aluminum alloy plant by the company is “the best way to move forward”.