Factory output rebounds in May with 2.29pc growth

ISLAMABAD: Pakistan’s large-scale manufacturing (LSM) sector grew by 2.29 percent in May 2025 from a year earlier, offering a glimmer of hope for industrial recovery. But the broader picture remains grim, as cumulative LSM output fell 1.21 percent during the first 11 months of fiscal year 2024-25, according to official data released Tuesday.

On a month-on-month basis, May 2025 saw a strong rebound of 7.93 percent over April 2025, buoyed by solid performances in the automobile, cement, sugar, and fertilizer industries. However, persistent declines in key sectors such as machinery, chemicals, iron and steel and garments continue to weigh down the overall momentum.

The LSM sector—responsible for nearly 68 percent of total manufacturing and contributing 8 percent to Pakistan’s GDP—has faced mounting challenges amid tepid domestic demand, high borrowing costs, and inconsistent energy supplies.

According to the Pakistan Bureau of Statistics, which compiles data from OCAC, the Ministry of Industries, and provincial statistical bureaus, the industrial recovery remains patchy.

Among the hardest-hit sectors in May were machinery and equipment, which nosedived 49.6 percent year-on-year, followed by furniture (-20.2pc), chemical products (-12.13pc), and tobacco (-14.4pc).

Wearing apparel dropped 1.59 percent, iron and steel products dipped 0.28 percent, and paper & board slid 4.66 percent. Football production also fell 12.8 percent, fabricated metals output shrank by 5.95pc, beverages 2pc, paper & board 4.66pc compared to May 2024.

On the other hand, automobile production surged by a striking 57.6 percent year-on-year, while cement output climbed 9.04 percent and sugar production jumped a staggering 44 percent. Fertilizers (up 20.4pc), non-metallic mineral products (9.48pc), and food (4.4pc) also posted strong gains.

Textiles—the largest component of LSM—rose modestly by 0.9 percent, driven by a 6.5 percent increase in cotton yarn output and 0.43 percent growth in cotton cloth. Pharmaceuticals (1.7pc), leather products (0.78pc), and electrical equipment (3.6pc) also posted positive growth.