Pakistan’s large-scale manufacturing declines 2.65 per cent in August

ISLAMABAD: Pakistan’s large-scale manufacturing (LSM) sector experienced a 2.65 per cent decline in August 2024 compared to the same period last year, according to the Pakistan Bureau of Statistics (PBS).

However, production saw a 4.68 per cent increase from July, which recorded 106.35 points.

For the first two months of the 2024-25 fiscal year, LSM output shrank by 0.19 per cent year-on-year.

Key sectors driving this decline include food (0.32 per cent), tobacco (0.39 per cent), textiles (0.63 per cent), garments (2.15 per cent), petroleum products (0.51 per cent), automobiles (0.39 per cent), pharmaceuticals (-0.10 per cent), cement (-1.02 per cent), iron and steel (-0.71 per cent), electrical equipment (-0.63 per cent), and furniture (-1.85 per cent).

The industrial sector plays a vital role in Pakistan’s economy, contributing about 18 per cent of GDP. Since GDP data is released quarterly and often delayed, policymakers use LSM performance as a gauge for the industrial sector’s health.

The LSM, which represents about 69 per cent of the manufacturing sector and roughly 8 per cent of the total GDP, serves as a key indicator of industrial production.

Despite some recovery in the latter half of FY24, economic activity has been hampered by declining global demand, currency depreciation, and a growing current account deficit, restricting the government’s ability to maintain fiscal stability in a challenging financial climate.

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