The State Bank of Pakistan observes that official data is not appropriately capturing the vibrant economic activities in the country e.g., retail sector and real estate, thereby implying that the actual growth was higher than the real GDP increasing by 4.1 percent.
SBP in its Annual Report of 2013-14, issued on Wednesday, strengthens its arguments by pointing that there are coverage issues in the Large-Scale Manufacturing (LSM) since only 15 sectors are identified instead of 22 identified International Standard Industrial Classification of United Nations. The manufacturing data reported by India contains all categories identified by ISIC.
Following are the coverage issues in LSM
==================================================================
Sectors Issues
==================================================================
Textile (i) LSM data for cotton cloth and cotton yarn
is collected by the Ministry of Textile, which
only covers mill sector activity. The non-mill
sector, which entails over 90 percent of over
all production of cotton cloth in the country,
is not included in the data set.
(ii) Textile production data is not classified
according to different types of fabrics; yarn;
fibers; and final products (such as apparel,
cotton based denim, bed-wear, hosiery). This
makes analysis of production trends very
difficult. However, PBS coverage of export
data is more extensive, and includes a number
of categories, like: hosiery/knitwear,
bed-wear, towels, tarpaulin & other canvas
goods, readymade garments, and synthetic
textiles.
Automobiles PBS reports the production of units registered
with Pakistan Auto Manufacturers
Association (PAMA) only, which include:
Pak Suzuki, Indus, Honda, Fiat, Deewan,
Hinopak, Ghandhara, Sind Engg, Master and
Isuzu. This leaves out some leading bus and
trucks manufacturers, namely Afzal Motors
and Al-Haj FAW motors.
Chemicals PBS reports data for 11 categories of chemicals,
with caustic soda claiming the largest share.
For caustic soda, production numbers are
obtained from Sitara Chemicals, ICI and Nimir
Industrial Chemicals. The production of Engro
Chemicals, which caters to one-third of the
entire domestic demand of caustic soda, is not
included in LSM data.35
Fast Moving (i) Food sector: Given the significant change
Consumers Goods in Pakistan's consumption patterns, the
(FMCG) demand and production of a number of
processed food items has grown in the past
few years (e.g. packaged milk & products,
dairy items, yogurt, pastas, cereals, frozen
and ready to cook items, etc). The production
of these items however, is not included in
LSM data, which leaves out large and vibrant
manufacturers like Unilever, Kolson, Nestle,
Efoods and National Foods.
(ii) Non-food: Similarly, non-food FMCGs
are also not captured by LSM. This includes
products like cosmetics, personal care products
and toiletries, which are produced by
prominent brands like Unilever, Medicam, and
Procter & Gamble.
Plastics The production of plastics is completely
absent from the LSM data set. According to
the Pakistan Plastic Manufacturing
Association (PPMA), there are around 6,000
upstream and downstream units operating in
the country, employing 0.6 million people.
This sector is producing a broad range of
products ranging from household items,
industrial containers, medical & surgical
items, auto parts, stationery items, PVC
pipes, etc. Yet they are not covered in LSM.
==================================================================