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Industrial activity in Pakistan is showing early signs of recovery, as large-scale manufacturing (LSM) posted 4.08% growth in the first quarter of FY26, driven primarily by a strong rebound in the automobile and cement sectors. September alone recorded 2.69% year-on-year growth, indicating gradual improvement after months of sluggish output.
According to fresh data from the Pakistan Bureau of Statistics, the industrial sector gained momentum after recent flooding slowed production. On a monthly basis, output rose 2.05%, supported by improving supplies and renewed activity in key industries.
LSM contributes nearly 8% to Pakistan’s GDP and had contracted 0.74% in FY25, missing the government’s 3.5% target. Officials say the current uptick is encouraging, though still fragile, as several major industries continue to post mixed performance.
The food sector grew 6.94% in the first quarter, led by strong wheat and rice milling. Textile output inched up 1.88%, though value-added garments declined for the second straight month in September. Petroleum products fell 3.35%, but diesel, kerosene and LPG showed solid recovery.
The standout performer remained the automobile industry, which surged 84.58% in Q1. Production of cars, jeeps, trucks and buses rose sharply as assemblers ramped up operations and cleared previous backlogs.
However, some sectors struggled. Pharmaceuticals fell 4.81%, and iron and steel output dropped 3.52%, reflecting weaker construction-linked demand.
Officials say that despite uneven performance across sectors, the overall direction points toward steady industrial stabilization. With improved energy availability, better supply chains and rising domestic demand, the government expects manufacturing to gain further pace in the coming months.
