The country's manufacturing sector has depicted 5.5 percent growth during July-February 2013-14 against 4.5 per cent during the corresponding period last year. According to the Economic Survey 2013-14, manufacturing accounts 13.5 percent of Gross Domestic Product (GDP) and 14.1 percent of total employed labour force.
Large Scale Manufacturing (LSM) at 10.9 percent of GDP dominates the overall sector accounting for 81 percent of the sectoral share followed by Small Scale Manufacturing which accounts 1.7 percent of total GDP and 12.3 percent share in manufacturing. The government has claimed that that impact of rise in electricity generation has been realised in the LSM growth which registered a growth of 4.3 percent during July-March, FY14 as compared to 3.5 percent last year.
The sector specific data showed that many sub sectors performed well during the period July-March 2013- 14 over corresponding period of last year. The sector which performed well during this period remained: Fertilizer 21.64 percent, leather products 12.96 percent, food beverages and tobacco 7.78 percent, rubber products 9.48, chemicals 6.71 percent, paper & board 8.03 percent, coke & petroleum products 7.48 percent, electronics 2.91 percent, iron and steel products 3.38 percent, textile 1.44 percent and non metallic mineral products 0.15 percent.
The improvement in gas supply, especially to fertilisers and leather industry in the past few months increased the output which can easily be gauged from the growth of Nitrogenous fertilizers 24.59 percent during the period under review. The growth in leather industry arrived from the Footwear 15.72 percent and upper leather 7.78 percent.
The food, beverages and tobacco group also remained the major contributor in the overall growth due to its heavy weight of 12.37 percent in LSM basket. The items showing positive growth in food, beverages & tobacco includes sugar 10.88 percent, soft drinks 34.03 percent, juices, syrups & squashes 13.69 percent and vegetable ghee 4.05 percent. Restaurant and fast food chains are flourishing in the country and the demand for dairy products, processed food and beverages has increased thus brought a positive impact on food group. In electronics products, air conditioners, deep freezers, electric motors, storage batteries and refrigerators were the main contributors which managed to grow by 36.12 percent, 83.03 percent, 20.01 percent, 3.27 percent and 2.63 percent respectively.
In petroleum products growth mainly arrived from the production of diesel oil 62.61 percent, high speed diesel 13.11 percent, lubricating oil 4.48 percent, furnace oil 11.62 percent and motor sprits 6.61 percent during the period under review.
In textile sector, the main contributing item was jute goods 6.30 percent however, heavy weight items like cotton yarn and cotton cloth showing marginal improvement by registering a growth of 1.76 percent and 0.68 percent. The recent improvement in energy as well GSP plus status augur well for future prospects of these two important sub-sector which will ultimately transmitted into the performance of textile sector in coming months.
Iron and steel industries were the major beneficiaries of steady construction activity in the country. Three new plants namely Aisha Steel, International Steel and Tuwairqi Steel have started commercial operations in recent years. The newly established plants are running on captive powers as the sector largely immune to power generation. In addition, Economic Co-ordination Committee (ECC) has recently approved restructuring plan for Pakistan Steel Mill (PSM) amounting to Rs 18.5 billion. The proper implementation of plan envisages achieving operational capacity around 77 percent, able to pay all their liabilities and also earn monthly profit of Rs 38 million onward from January 2015.
The resolution of circular debt not only improved petroleum refining also benefited other industries by improving power supplies. The capacity enhancement, upward trend in credit utilisation, steady construction activities, favourable palm oil prices and use of alternate energy by various industries help to support LSM sector.
The sectors which recorded negative growths are; engineering products 21.40 percent, woods products 8.91 percent, pharmaceuticals 0.49 percent and automobiles 0.01 percent. In automobiles, the sub items of automobile sector such as LCVs, trucks, buses and motor cycles posted a growth of 27.95 percent, 30.94 percent, 11.25 percent and 3.38 percent respectively while tractors registered a negative growth of 33.57 percent.
Pakistan approved its first ever five-year textile policy in 2009 with a financing plan of rupees 188 billion for various short-to-long term initiatives aimed at sustainability of textile value chain. The Ministry of Textile is in process of formulating the new five-year textile policy which will be ready by June 30 this year and will be implemented in the next five financial years (2014-19) with major thrust on value-added sector. The policy will propose major incentives for the value-added textile sector and also attract new investors in order to enhanced exports up to $26 billion in next five years.
The mining and quarrying sector estimated to grow at 4.4 percent in 2013-14 as against 3.8 percent last year. Sulphur, Chromite, Bauxite, Dolomite, Coal, Lime Stone, Crude Oil and Rock Salt posted a positive growth rate of 74.7 percent, 70.8 percent, 53.3 percent, 40.7 percent, 16.0 percent, 14.3 percent, 11.6 percent and 10.7 percent, respectively. However, some witnessed negative growth rate during the period under review such as the growth of barytes declined by 41 percent followed by magnetite 39.6 percent, cooper 28.4 percent, soap stone 9.2 percent and phosphate 9.1 percent, respectively.
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