LSM growth stays lackadaisical

The declining growth trends in the manufacturing industry have once again lent an overall air of gloom to the countrys teetering economy, with large scale industrial output in a slow and steady spiral since the beginning of the current fiscal year. And expectations of good news from these quarters are fast becoming an exercise in futility.
With stunted productivity becoming the norm for a number of previously flourishing sectors, the QIM for August has once again posted less than stellar results, managing to maintain a dismal, less than one percent growth momentum it has been exhibiting during the past six months.
Occurring on the back of backsliding production in fertilizers, textiles and electronics, large scale manufacturing statistics for the month of August have shown a 2.75 percent decline over July, while year-on-year, the growth remained stuck at an unimpressive 0.84 percent, according to data released by PBS.
Volatility in raw material prices and the back breaking energy crises has continued to leach away productivity from previously healthy sectors, and the OCAC Index reports a 27 percent decline in the production of fertilizers in the month of August. Similarly, production of textiles, with a weightage of 20.91 within the LSM basket only managed to slide down a further 2.88 percent over the same period last year.
The production statistics for the countrys highest export revenue earner have continued to remain depressed amid a lack of domestic and international demand as well as high input costs that are consistently making Pakistans product more expensive in comparison to textile products originating from countries like Bangladesh.
And industry-specific data does not seem to harp on any good tidings on the textile sector soon. Moreover, EMCs newly released load management plan has also been not very considerate to the textile industry, putting the sector on an irrational six hours a day loadshedding plan, while promising to provide relief to cement and various other continuous process industries.
However, on the one hand while experts lament the dwindling production in many industrial sectors due to capacity constraints and unit closures due to gas curtailments, thriving consumerism is leading the growth of food and beverage sector once more.
With a combined weight of 12.2 percent, the sector has once again lead the names of industries showing an increase in output, posting a seven percent growth over the same period last year at the end of August.
Witnessing a steady growth, the sector has continued to gain momentum and despite there being a significant lack of policy implementation to improve the segments productivity, experts agree that the sector is likely to carry on with its current growth spurt well into 2013.