Find Industry and Manufacturing expertise in Pakistan
The industrial sector in Pakistan contributed 25% to the country’s GDP for 2011, while the manufacturing sector accounted for 14.54% of total GDP for the same year, according to a World Bank Report (2012). Since the early 2000s manufacturing has seen a noticeable drop in GDP contribution, brought about in part by the global financial crisis. In 2008 the total GDP contribution of the manufacturing sector was 19.66% (World Bank, 2012). In 2010 20.7% of total labour force in Pakistan was employed by the industrial sector (CIA World Factbook 2010), manufacturing made up the majority of employment from the industrial sector accounting for 13.7% of Pakistan’s total labour force for the same year (Government of Pakistan Ministry of Finance, 2012).
The major products manufactured in Pakistan are: textiles, chemicals, machinery, tobacco and agri-products. The textiles industry is the largest sub-sector of the manufacturing industry and also provides the biggest source of employment, representing 39% of the manufacturing sector as a whole, and making an 8.5% contribution to GDP (Government of Pakistan Ministry of Commerce & Textile Industry, 2012). According to the Pakistan Credit Rating Agency, Pakistan is the fourth largest producer of cotton. A large proportion of textiles produced in Pakistan are exported, with the sector generating the country’s highest export earnings of about 58%. In 2011 Pakistan’s exports totalled US$24.8billion, with a total contribution from Textiles of $13.8billion (The Pakistan Credit Rating Agency Limited, 2012). One of Pakistan’s major contributors to the textile market is Nishat Mills Limited, one of the largest textile companies in Pakistan. In 2011 Nishat Mills ltd total exports amounted to US$416million.
While textiles make up the majority of Pakistan’s exports, other major products for export include rice, representing 10% of the total yearly exports for 2010, and refined petroleum oils, representing 6% of the exports for the same year. Pakistan is major trade partners with the US, China and Germany, as well as parts of the Middle East (Observatory of Economic Complexity, 2010).
The textiles sector of Pakistan’s manufacturing industry currently benefits from sector specific concessions including a zero rating tax facility on all textile products, reduced export refinance rate, and long term financing for export oriented projects at lower interest rates (The Pakistan Credit Rating Agency Limited, 2012).
Since 2008 Pakistan’s Manufacturing sector has faced several potentially serious issues. Firstly the sector suffered from the impact of economic uncertainty and weaker global demand following the global economic crisis. This was followed by an increase in overall production costs resulting from a rise in energy prices. As well as this the Depreciation of the Pakistani rupee during 2011 also significantly raised the cost of imported inputs, while high inflation has had a detrimental effect on the overall manufacturing sector (Rawalpindi Chamber of Commerce and Industry, 2012).
The 2012-2013 World Economic Forum Global Competitiveness Report rates Pakistan as 73 out of 144 countries based on production process sophistication, scoring 3.6 out of 7, where 7 is the most sophisticated. This is slightly low score for the region, with neighbouring India having a higher ranking of 46 and scoring 4.1 (WEF, 2013).
All Pakistan Textile Mills Association (APTMA) is a trade organisation representing the Pakistani spinning, weaving and knitting industries. The association provides one million direct employment opportunities, as well as three million indirect jobs, making APTMA the largest trade union in Pakistan. As an organisation APTMA is involved in influencing government legislation to the benefit of the textile industry, as well as focusing on research and development for the textile industry as a whole, collecting 20 rupees per cotton bale from the member mills to fund research through the Pakistan Central Cotton Committee. Membership is voluntary.
|Industry and Manufacturing organisations in Pakistan|