Pakistan’s large-scale manufacturing (LSM) sector posted strong growth in July 2025, signalling a steady rebound in industrial activity. According to the Pakistan Bureau of Statistics (PBS), the sector expanded by 8.99 percent year-on-year, with automobiles, garments, cement, and petroleum products leading the recovery.
The Quantum Index of Manufacturing (QIM) stood at 115.68 in July, up from 106.14 a year earlier. On a monthly basis, the index rose 2.6 percent compared to June, reflecting momentum in production and demand.
Autos, garments, cement drive growth
Automobiles emerged as the fastest-growing sector, with production jumping 57.8 percent compared to July 2024. The sector alone added 1.33 percentage points to overall growth, reflecting improved supply chains and demand.
Garments also contributed strongly, recording a 24.79 percent rise and adding 3.8 percentage points to growth. Cement output increased 18.75 percent, supported by active construction projects, while petroleum products grew by 13.18 percent. Furniture manufacturing rebounded sharply with an 86.79 percent surge, while other transport equipment rose 45.8 percent.
Mixed performance across industries
Despite overall gains, some sectors weighed on results. Fertiliser production dropped 1.6 percent, while iron and steel declined 3.69 percent. The chemical industry fell 2.64 percent, and beverages saw a 6.19 percent decline. Machinery and equipment posted the steepest drop, down 22.77 percent, reflecting weak investment activity.
Food output expanded 6.63 percent, while textiles recorded only 0.04 percent growth. Paper and board rose 15.01 percent, supported by packaging and publishing demand.
Outlook for manufacturing
Analysts say rising industrial activity is a positive sign for Pakistan’s economy, especially for jobs and revenue. However, challenges such as energy costs, inflation, and global demand remain risks. Sustained recovery will require consistent policies and stable input supplies.
The PBS report highlights the resilience of consumer-focused industries, with garments, automobiles, and furniture showing robust demand. If the trend continues, industrial activity could play a key role in supporting Pakistan’s broader economic recovery this fiscal year.
In other news read more about: Advocating for a Comprehensive Pro-Trade Strategy in Pakistan
