Pakistan's large-scale manufacturing declines 1.78% this year

Large-scale manufacturing in the country has been declining for some time. This trend is expected as the economy faces significant challenges. Since July 2022, the output from big industries has been mostly negative, except for a few brief months of improvement. Despite some areas showing signs of activity, like car and cement sales, the real sector continues to struggle. Several factors are hurting growth. High interest rates, increased taxes, rising energy costs, and a shortage of dollars for imports are just a few reasons for this decline. Additionally, lower use of fertilizers and decreased spending on food and drinks are affecting manufacturing. The slowdown in construction has also led to reduced output in iron and steel industries. Overall, big industry growth fell by 1.78% in the first seven months of this fiscal year compared to last year. In the previous year, there was a small contraction in large-scale manufacturing growth. The current economic situation raises concerns about the future of large-scale manufacturing. While inflation has recently decreased, other risks remain. The current account surplus is due to more remittances coming in, but pressures from rising imports and weaker foreign investment are becoming a concern. Although there have been some improvements, the economy still struggles to gain momentum. For sustainable growth, the country needs to focus on fixing structural issues instead of relying on imports.