The large-scale manufacturing (LSM) sector Production increased by 6.7 per cent YoY during October 2020, as per the data released by the Pakistan Bureau of Statistics on Tuesday. The LSMI Quantum Index Number (QIM) was recorded at 138.03 in October 2020 as against 128.22 points in October 2019.
Minister for Industries and Production Hammad Azhar tweeted:
Segment wise, Textile production increased by 2.4%, Food Beverage and Tobacco production increased by 8.6%, Pharmaceuticals production increased by 11.3%, Non Metallic Minerals production increased by 24.5%, Fertilizers production increased by 18.5%, Automobiles production increased by 10.7%, and Iron & Steel production increased by 2.8% lifted the index while Coke & Petroleum production decreased by 1.7%, Electronics Coke & Petroleum production decreased by 30.5% and Leather products production decreased by 39.7%.
Textile sector grew by 2.4% YoY on the back of 6.0/8.0% YoY/MoM increase in exports during Oct’20. Looking ahead, we are optimistic as the sector has recovered from COVID related slowdown, in both domestic and export markets. FBT grew by 8.6% YoY supported primarily by 108.8% YoY surge in wheat which was a result of govt channeling wheat to millers to meet demand shortfall.
Non-Metalic Minerals production increased by 25% YoY due to 25.1% rise in cement as domestic/foreign dispatches increased significantly. The Cement demand from the construction package has yet to make an effect expected from November-2020 onwards, which will keep the sector production witness upward trend in the coming months.
Auto Production witnessed a growth of 10.7% YoY on the back of 20.6% YoY growth in Jeeps and Cars. Improving macro indicators along with low auto financing cost is expected to keep demand strong and allow the sector to grow going forward.
After consecutive months of decline, steel Production finally increased by 3% YoY due to 45% YoY growth in Billets/Ingots. Announcement of Contruction package and Improving Economic Indicators will give support to the sector going onwards .
Pharmaceuticals production increased by 11% YoY due to increase in production of Syrups/Capsules/Injections. The growth was largely a result of increased exports. Paper and Board increased by 9.1% YoY as a result of an increase in FBT and commercial activity post-lockdown.
Fertilizer sector production increased by 18% YoY due to 17.9/24.1% YoY growth in Nitrogen/Phosphorus fertilizers. Growth in urea can be attributed to provision of subsidy to RLNG based urea plants, better gas flows to EFERT, and resumed production of NP by Pak Arab Fertilizers.
Petroleum Products production decreased by 2% YoY due to Naphta and Furnace Oil production falling by 26.2/1.9% YoY. Currently refineries are operating at lower levels as a result of lower pricing and availability of imported fuel, keeping production of Petroleum products at lower level. However, production of Petrol and Diesel marked a growth of 9% and 3% YoY respectively.
Taking the moment to mark onset of economic recovery, Minister for Planning and Development Asad Umar announced “acceleration in economic recovery” via a tweet.
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