Pakistan’s large industries contract despite minor monthly growth
Pakistan LSM FY25 performance: Growth in automobiles and textiles, decline in iron, steel, and food
Islamabad—(Special Correspondent—Web Desk)—The Large-Scale Manufacturing (LSM) sector in Pakistan contracted by 0.74% in FY25, missing the growth target of 3.5%. Contributing around 8% to the national GDP, LSM’s performance remained weak compared to FY24, which recorded a minimal contraction of 0.03%.
Despite this, June 2025 saw 4.14% year-on-year growth, marking the fourth consecutive month of positive performance, mainly due to a reduction in the key interest rate to 11%. However, month-on-month data showed a 3.67% decline, indicating ongoing volatility.
Sector highlights: The automobile sector grew strongly by 46.15%, with significant rises in cars, trucks, LCVs, and buses. Textiles expanded by 2.49%, driven by cotton yarn, cloth, and garment exports. Pharmaceuticals and fertilizers posted modest gains of 2.74% and 1.69%, respectively.
Conversely, traditional heavy industries faced challenges. Iron and steel contracted by 8.71%, while rubber products, non-metallic minerals, and electrical equipment declined by 1.27%, 7.88%, and 11.65%, respectively.
The food sector fell 1.83%, though wheat and rice milling rose 6.38%, and starch production grew 0.59%. The coke and petroleum sector grew 5.33%, with petrol, diesel, and kerosene output rising, while LPG and jet fuel production fell.
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Summary: FY25 showed a mixed performance in Pakistan’s manufacturing. Automobiles and textiles led growth, while heavy industries and some food sectors weighed down overall progress. Policymakers may need to focus on stabilizing underperforming sectors for stronger growth in FY26.
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