LSM sector recorded minor growth in 6 months

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ISLAMABAD - Pakistanís large scale manufacturing (LSM) sector has recorded minor growth of 2.12 percent during first half (July-December) of ongoing financial year 2012-13 mainly due to persistent energy shortages, unfavourable law and order situation and weak global economic environment.

Poor law and order situation, political uncertainty, acute energy crisis and less domestic demand have badly hit Pakistanís large scale manufacturing (LSM) growth during July-December 2012-13, as it grew by only 2.12 percent over the same period last year.

These issues have kept the manufacturing sector under stress for the last several years and are also responsible for high cost of doing business. This scenario is compelling investors and businessmen to freeze their businesses expansion or wrap them up.

According to latest figures released by Pakistan Bureau of Statistics (PBS) on Tuesday, the Quantum Index Number (QIM) of Large Scale Manufacturing (LSM) industries stood at 107.96 points during July-December period of 2012-13 as compared to 105.71 points of the corresponding period of 2011-12. Meanwhile, the LSM sector recorded increase of 11.69 per cent during the month of December 2013 as against previous month of November. The Quantum Index Number of LSM industries stood at 119.30 points in December 2013 as compared to 106.82 points of November period of 2013.

LSM growth has been hindered by energy shortages and lawlessness. The cost of doing business has also been high due to these factors, forcing businessmen to wrap up or contract businesses, which will ultimately have an adverse effect on countryís GDP growth, economic experts said.

The Quantum Index Numbers (QIN) of Large Scale Manufacturing Industries has been computed in the FBS on the basis of latest production data of 112 items received from various sources i.e. Oil Companies Advisory Committee (OCAC), Ministry of Industries & Production and Provincial Bureaus of Statistics. The OCAC supplied the data of 11 items, the Ministry of Industries & Production supplied the data of 36 items and Provincial Bureaus of Statistics provided data for 65 items. According to the PBS figures, OCAC group growth went up by 0.62 per cent during the first six months of the ongoing financial year; Ministry of Industries registered a growth of 0.21 per cent and provincial BOS showed growth of 1.29 per cent in July-December period of 2012-13 against the same period of the last year.

The official data revealed that following sectors registered positive growth in July-November 2012-13 period against the same period of last year: food, beverages and tobacco 2.69 per cent, iron and steel products 19.30 per cent, coke and petroleum products 10.45 per cent, paper and board 34.84 per cent, rubber products 28.44 per cent and pharmaceutical 6.50 per cent, non metallic products 2.89 per cent and textile 0.24 per cent.

Courtesy: The Nation

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