LSM grows 3.3 percent in 11 months

ISLAMABAD: The Large scale manufacturing (LSM) growth clocked in at 3.3 percent during July-May against 4.28 percent in the corresponding period last year, the Pakistan Bureau of Statistics (PBS) reported on Wednesday.
LSM contributing 10.6 percent to the Pakistani economy, its growth hampered by a broad range of issues, including weak export of cotton yarn, gas shortages in a number of industries and sector-specific factors such as closure of large chip board plant and substitution of domestic production of edible oil with imports.
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 May 2015, the manufacturing sector expanded 5.9 percent over the same month last year, while it decreased by 4.8 percent over April 2015.
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 the Oil Companies Advisory Committee (OCAC), Ministry of Industries and Production and provincial bureau of statistics.
The OCAC supplied the data of 11 items, registering 0.36 percent expansion in July-May 2014/15.
The production ministry recorded data of 36 items, exhibiting a growth of 1.53 percent and provincial bureaus of statistics providing data for 65 items, registering an expansion of 1.42 percent over the corresponding period (July-May) in the last fiscal year (2013/14).
During the period under review, production of iron and steel products increased by 36.5 percent, automobiles 21.6 percent, leather products 8.5 percent, electronics 5.38 percent, pharmaceuticals 8.03 percent, chemicals 8.15 percent, coke and petroleum products 8.24 percent and non-metallic mineral products 2.8 percent.
Interestingly, textile sector, which has a high value in LSM, grew only by 0.54 percent, while the fertiliser sector up 3.27 percent.
During July/May 2014/15, the growth of wood products dipped 75.4 percent, engineering products 17.18 percent, paper and board 8.58 percent and food, beverages and tobacco production declined by 1.07 percent over July-May 2013/14.