KARACHI: The manufacturing sector witnessed 6.24 per cent growth on the back of stellar performance of large-scale manufacturing (LSM) during the first eight months of the current fiscal year as it touched its 11-year peak of 6.13pc.

The industrial sector maintained its upward trajectory at 5.8pc — the highest in last 10 years — according to the Economic Survey 2017-2018 released on Thursday. The publication attributed growth in the manufacturing to ample liquidity in the banking system, a highly investment-friendly interest rate environment, low inflation and strong domestic demand for consumer durables.

Automobile sector grew by 19.58pc in July-February FY18, led by its sub-sectors such as tractors going up by 44.68pc, trucks 24pc, jeeps and cars 23.29pc, light commercial vehicles 19.73pc and motorcycles 14.15pc while buses posted a negative growth of 39.35pc.

The survey predicts auto sector to continue expansion due to entry of new variants such as Hyundai, Renault, Nissan, coupled with rapidly growing ride-hailing services like Careem and Uber. In addition to strong demand for automobiles, rising income levels together with low interest rates led to a significant uptick in auto-financing.

Recently, prime minister inaugurated Hyundai-Nishat vehicle assembly plant in Faisalabad while Nishat Mills offered an 18pc stake to Millat tractors in its car venture. Renault too signed a new agreement with Al-Futtaim Group, a Gulf-based conglomerate, to assemble cars in Karachi.

The automobile industry sales during July-February 2017-18 posted 23pc growth with tractors leading the pack with a jump of 39.5pc in sales, followed by 15.4pc rise in buses and trucks and 17.7pc in two and three-wheelers. In light of the ongoing infrastructural undertakings in the country, the auto sector looks ideal for another healthy performance. The imposition of regulatory duties on the automobile sector is expected to create a favourable situation during the year as it may further enhance domestic production, the survey added.

During the first eight months of 2017-18, cement sales rose to 34.76m tonnes, up 14.70pc from 30.30m tonnes despatched during the corresponding period of last year.

The survey noted that this domestic growth is mainly due to the policies of government and its thrust on mega infrastructure projects and will further pick pace substantially if smuggling from the Iranian border is kept under check.

Textile sector maintained an average share of about 60pc in national exports, the survey revealed. The production of cotton cloth (mill sector and non-mill sector) slightly rose by 0.03pc whereas exports fell by 0.80pc in quantity while rising by 0.04pc.

Ready-made garments’ exports in the period went up from 22.708m dozens to 25.621m dozens across various categories to stand at $1,695.557m during Jul-February FY18 as compared to $1,499.472m in the corresponding period of FY17, higher by 13pc in both value and quantity.

Knitwear exports went up by 13pc and 3pc in terms of value and quantity. During the reviewed period, synthetic textile fabrics worth $197.280m were exported as compared to $109.552m during the same period of last fiscal year, showing a jump of 80pc. Quantity-wise, these exports increased by 108.53pc.

Published in Dawn, April 27th, 2018