EDITORIAL: Pakistan Bureau of Statistics (PBS) calculated large-scale manufacturing (LSM) growth at 4.82 percent year-on-year during July-December 2025 compared to the same period the year before, driven by strong performance in automobiles, petroleum, garments, and cement sectors.
This is attributed to the low base in the previous year – the LSM growth July-November 2024-25 as per the Finance Division’s January 2026 Update and Outlook was negative 1.41 percent, while the growth for the same period in the current year was calculated at 6.01 percent. It is relevant to note that a decline in the growth for the first half of the current year to 4.82 percent as opposed to 6.01 percent July-November is at odds with the claim that the LSM sector witnessed a robust 9.2 percent growth in December 2025 compared to November 2025 – data that challenges the statistics compiled by the PBS (Pakistan Bureau of Statistics).
READ MORE: Large-Scale Manufacturing posts 4.82% growth in July–December
Recent surveys by Business Recorder on LSM sub-sectors indicate that factory closures have reached an alarming rate — textile organisations cited closure of 150 units, the steel, and cement factories noted that they were operating at reduced capacity due to a massive rise in input costs that continues to be a deterrent, that is acknowledged by the government which led to the announcement of incentives to LSM, which may have to be withdrawn if the International Monetary Fund (IMF) insists on the administration adhering to the agreed conditions. In addition, several multinationals have also announced closure of their operations.
Be that as it may, it is also relevant to determine whether the rise in LSM as claimed by the PBS is due to enhanced output or due to higher sales that have drawn down existing inventories. PBS notes two sources of data on LSM – the Census of Manufacturing Industries (CMI) conducted by PBS and Quantum Index of LSM (QIM) on manufacturing sectors output.
The Bureau notes that it develops new weights for production index of manufacturing every five years but acknowledges that the last one was held ten years ago in 2015-16. PBS does not take account of a decline in inventories or actual output but focuses on sales.
The Bureau also relies on Oil Companies Advisory Council (OCAC) for fuel consumption and data on their website shows the following disturbing data that does not gel with the PBS claim that petroleum sales rose: domestic consumers witnessed a decline in consumption from 14,221 metric tons July-December 2024 to 7,026 metric tons in the same period 2025, industry witnessed a decline from 500,664 metric tons in the first half of fiscal year 2024 to 273,801 metric tons in the same period of this year, and power sector witnessed a decline from 96,292 metric tons to 20,003 metric tons this year.
The reason is the erosion of the rupee value and the failure of the private sector (of which LSSDM is a component) to raise wages, given the continued fragility of the economy.
To conclude, there appears to be an increasing tendency on the part of PBS to release positive data reflecting well on the state of the economy that is easily challengeable as it is at odds with corresponding data. One can only hope that the ongoing technical assistance by the IMF designed to overcome the “important shortcomings” in PBS’s data collection are resolved, and accurate timely data is released that is critical for formulating and implementing mitigating polices.
Copyright Business Recorder, 2026