LSM expands 2.49pc in July-March

ISLAMABAD: Large scale manufacturing (LSM) growth clocked in at 2.49 percent in the first nine months (July-March) of the current fiscal year, the Pakistan Bureau of Statistics (PBS) data showed on Friday.
The LSM growth was recorded at 5.48 percent in the same period last year.
A senior economist said this growth performance is far worse, indicating that it will hit hard the country’s GDP growth rate, which may fall below four percent by the end of the current fiscal year.
“LSM growth has almost choked over the past one year and we cannot expect a higher GDP growth, unless growth in other sectors is increased,” he told The News.
LSM has a backward and forward linkage with other industries and services and transport sectors. The fall in growth represented an upset for a number of sectors. In March 2015, the manufacturing sector expanded 4.53 percent and in February 2015 it grew 1.77 percent.
Historically, Pakistan’s manufacturing sector grew at an average rate of eight percent from the 60s to 80s, but fell to 3.9 percent during the 90s. The huge downward jump was mainly caused by reduction in investment levels due to the lack of continuity and consistency in policies.
During the last financial year (July-June 2013/14), LSM growth was recorded at 3.98 percent.
The PBS computes the quantum index numbers of LSM on the basis of latest production data of 112 items received from various sources, including Oil Companies Advisory Committee (OCAC), Ministry of Industries and Production and provincial bureau of statistics.
The OCAC supplied the data of 11 items, registering 0.15 percent expansion in July-Mar 2014/15.
The production ministry recorded data of 36 items, exhibiting a growth of 1.02 percent and provincial bureaus of statistics providing data for 65 items registering an expansion of 1.31 percent over the corresponding period (July-Mar) in the last fiscal year (2013/14).
During the period under review, production of iron and steel products increased by 35.6 percent, automobiles 17 percent, leather products 9.6 percent, electronics 8.2 percent, pharmaceuticals 6.38 percent, chemicals 5.94 percent, coke and petroleum products 4.7 percent and non-metallic mineral products 2.56 percent.
Interestingly, textile sector, which has a high value in LSM grew only half a percent, while fertilizer sector 0.95 percent.
During July/Mar 2014-15, growth of wood products dipped 78.46 percent, engineering products 10.68 percent, paper and board 7.26 percent and food, beverages and tobacco production declined 1.03 percent over July-Mar 2013/14.