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TRADE CHRONICLE Jul - Aug - 202275 years of Pakistan8
TRADE CHRONICLE Jul - Aug - 2022A review of industrialization in 75 Years of PakistanBy Dr. Muhammad Nawaz IqbalUp until the fiscal year 2021, theindustrial sector in Pakistan willprovide 28.11% of the country'sGDP. Manufacturing accounts for12.52 percent of this, followed bymining (2.18 percent), construction(2.05 percent), and power and gas (1.36percent). The majority of industrialunits are in the textile sector, whichcontributes $15.4 billion in exports, or56% of all exports. Chemicals, medicaldevices, and a developing automobileindustry are additional units.The manufacturing of cotton textilesis the single most significant industry,employing around 19% of all largescaleindustrial workers. In 1999–2000,Pakistan's exports of cotton yarn,cotton cloth, made-up textiles, readymadeclothing, and knitwear totaledclose to 60%. Cement, vegetable oil,fertilizer, sugar, steel, equipment,tobacco, paper and paperboard,chemicals, and food processing arefurther significant businesses. Thenational industrial base is beingdiversified, and export-orientedindustries are receiving more attentionfrom the government. Since the middleof the 1960s, the industrial sectorhas contributed between 19 and 25percent of the nation's gross domesticproduct (GDP), or 24.5 percent in2004. With over 19 percent of GDPeach, manufacturing and constructiondominate the industrial sector.Since the 1980s, the industrial sector hasemployed between 17 and 20 percentof the working population (25 percentin 2004), primarily in manufacturingand construction. Although theindustrial base has expanded sinceindependence, textiles and sugar stilldominate the manufacturing base.As a result, production is susceptibleto bad weather and changes in theprice of commodities like sugar andcotton on the global market. In citiesand towns, cottage industries havealso become incredibly important.Hand-woven carpets, embroideredpieces, brassware, rugs, and traditionalbangles are in high demand. These arelikewise regarded as significant exportgoods and are in high demand onglobal marketplaces.Textiles, food, drinks, andtobacco, Coke & Petroleum, andPharmaceuticals make up themajority of Pakistan's manufacturingindustry. Large Scale Manufacturing(LSM), Small Scale Manufacturing(SSM), and slaughtering are the three"components" of the manufacturingindustry. Small Scale Manufacturingcomes in second with 2.12 percentof total GDP and a 16.6 percentsectoral share, trailing Large ScaleManufacturing, which accounts for9.73 percent of GDP and 76.1 percent ofthe sectoral share in the manufacturingindustry as a whole.About 3.7 percent of our overallexports are made up of sports goods.The primary raw materials used inthe production of sporting goodsare imported PVC as well as leatherand mulberry wood, both of whichare found in Punjab. The majority offootballs, hockey pucks, hockeysticks, cricket bats, and rackets aremade by hand. Both Sialkot andLahore have access to skilled labor.Large and medium-sized factoriesin the sector subcontract work tohome-based and small businesses.One of Pakistan's main sourcesof foreign exchange gains is thelocal manufacturing of sportingproducts. It is mostly producedin and around the city of Sialkot,where it has thrived as a cottageindustry thanks to generations oftalented craftsmen. This industrywas in its infancy at the time ofindependence, with a nominalexport of Rs. 0.82 million. Byoffering producers loans andincentives as well as making plans9to market the created goods, thegovernment moved swiftly to growthis industry. Taiwan, India, and SouthKorea are among the fierce competitorsin this sector. The chance to modernizeand mechanize the business has notbeen taken advantage of, despite thegovernment having offered numerousincentives and facilities.Pakistan's manufacturing sector iscentered on textiles, which account for56 percent of all exports, $15.4 billionin export revenue, and 40 percent ofemployment. Pakistan is the world'sfourth-largest producer of cottonand the eighth-largest exporter oftextiles in Asia. Textiles are in higherdemand due to rising urbanizationand a middle-class that is expanding.Pakistan's major manufacturing sectoris the textile industry. In Asia, Pakistanis the eighth-largest exporter of textilegoods. Pakistan's GDP is 8.5% derivedfrom the textile industry.Additionally, the industry employs38% of the manufacturing workforceand roughly 45% of the nation's entirelabor force. Pakistan is Asia's thirdlargestcotton producer by spinningcapacity, behind China and India,and it provides 5% to the world's totalspinning capacity. Currently, there are442 spinning units, 124 big spinningunits, and 425 small units thatmake textiles, totaling 1,221 ginningunits. In Pakistan, it dominates themanufacturing sector. $3.5 billion 6.5percent of all cotton shipped globallyin exports between 2017 and 2018.In Asia, Pakistan is the eighth-largestexporter of textile goods. Contributionto the economy is almost 8.5% of theoverall GDP. About 45% of the laborforce in the nation is employed in thetextile sector.Since the early 1980s, variousliberalization reforms have beenpursued, but have been hamperedby significant corruption, frequentshortages of raw materials, thegovernment's propensity to grantgenerous concessions to specificindustries, such as sugar refiningand yarn spinning, and an oneroustax structure that has assisted in thegrowth of the informal economy.According to estimates, Pakistan losesbetween 5 and 6 percent of its GDP,or roughly $6 billion, as a result ofinadequacy. Our products' productioncosts are increased by around 30% as aresult of logistical difficulties.
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