Industrial activity shows signs of recovery with 4.08% LSM growth in first quarter

Pakistan’s large-scale manufacturing (LSM) sector recorded 2.69 per cent year-on-year growth in September, pointing to a gradual pickup in industrial production, according to data released by the Pakistan Bureau of Statistics.

On a month-on-month basis, output increased 2.05 per cent, reflecting a modest recovery following disruptions caused by recent flooding.

In the July–September period, LSM posted 4.08 per cent growth, supported mainly by higher production in the automobile and cement sectors. The sector had shown 8.99 per cent growth in July, which slowed to 0.54 per cent in August. 

LSM, which contributes nearly 8 per cent to GDP, had contracted 0.74 per cent in FY25, falling short of the government’s 3.5 per cent growth target. In FY24, the sector recorded a marginal 0.03 per cent contraction.

Food production increased 6.94 per cent in the first quarter of FY26, with wheat and rice milling up 9.30 per cent and starch output up 0.64 per cent. Cooking oil production rose 8.54 per cent, while vegetable ghee dipped 0.06 per cent and blended tea fell 5.35 per cent. 

The textile sector grew 1.88 per cent, with cotton yarn up 2.62 per cent and cotton cloth up 0.28 per cent. Garment production rose 2.43 per cent in the quarter but posted 2.18 per cent negative growth in September, marking the second consecutive monthly decline for value-added textiles.

Coke and petroleum products declined 3.35 per cent, with petrol production down 3.52 per cent, jet fuel down 5.23 per cent and furnace oil down 21.62 per cent. High-speed diesel increased 10.83 per cent, kerosene 11.17 per cent, LPG 8.20 per cent and lubricating oil 46.50 per cent.

The automobile sector posted robust growth of 84.58 per cent in the quarter. Production of cars and jeeps increased 86.19 per cent, LCVs 6.36 per cent, trucks 139 per cent and buses 21.43 per cent. Diesel engine output rose 3.23 per cent. Pharmaceutical production fell 4.81 per cent, while fertilisers grew 0.97 per cent.

Iron and steel output decreased 3.52 per cent, with billets and ingots down 10.20 per cent and H/CR sheets, strips, coils and plates down 0.75 per cent. Output of rubber products increased 14.10 per cent, non-metallic minerals 13.86 per cent and electrical equipment 4 per cent.