By Moaaz Manzoor

Pakistan's large-scale manufacturing (LSM) sector expanded 6.44% during the first 10 months of FY26, driven by a sharp recovery in automobile production and solid growth in garments, food processing, cement and other consumer-linked industries, according to provisional data released by the Pakistan Bureau of Statistics (PBS).

The latest figures indicate that industrial activity continued to strengthen during July-April FY26, supporting expectations of a broader economic recovery despite persistent weakness in some segments of heavy manufacturing.

The Quantum Index of Manufacturing (QIM) stood at 122.19 during July-April FY26, compared with 114.79 in the corresponding period of last year. On a year-on-year basis, LSM output rose 6.06% in April 2026. However, production declined 8.32% compared with March, suggesting some moderation after stronger growth in the previous month.

The automobile sector remained the biggest driver of manufacturing growth, contributing 1.61 percentage points to overall expansion. Vehicle production surged 64.33% during July-April FY26, while output in April alone jumped 83.88% compared with the same month last year.

Garments emerged as another major contributor, adding 1.19 percentage points to overall growth as production increased 7.34% during the review period. Food industries contributed 1.60 percentage points, reflecting stronger consumer demand and higher processing activity.

Growth was broad and spanned a wide range of industries. Cement production increased 9.13%, beverages 7.87%, tobacco 12.74%, electrical equipment 13.46%, furniture 27.89%, and other transport equipment recorded a robust 42.30% rise.

At the product level, sugar production posted a notable 31.60% increase during July-April FY26, reflecting improved raw material availability and stronger industrial activity. Cement, garments and several consumer-oriented manufacturing segments also maintained positive momentum throughout the fiscal year.

The data suggest that consumer demand and construction-related activity are increasingly supporting industrial growth. Rising automobile production, higher cement output and expansion across several consumer industries signal improving business conditions and stronger investment activity compared with the previous year.

Despite the encouraging headline numbers, the recovery remained uneven across the manufacturing landscape.

Several sectors continued to contract during the period. Pharmaceutical production declined 6.55%, iron and steel products 6.98%, chemicals 2.30%, fertilizers 1.98%, and machinery and equipment 4.18%, highlighting ongoing challenges in parts of the industrial sector.

PBS data showed positive growth in food, beverages, tobacco, textiles, wearing apparel, paper and board, petroleum products, rubber products, non-metallic mineral products, fabricated metal products, electrical equipment, automobiles, transport equipment and furniture. In contrast, leather products, chemicals, pharmaceuticals, iron and steel products, and machinery and equipment remained in negative territory.

While the month-on-month decline in April indicates that industrial momentum softened after March, cumulative growth during July-April FY26 suggests Pakistan's manufacturing sector has entered a firmer recovery phase, supported by stronger domestic demand, improving business activity and a sustained rebound in automobile production.

Credit: INP-WealthPk