The manufacturing sector grew at an average rate of 8 percent from the sixties to the eighties, but fell to 3.9 percent during the nineties. This was mainly caused by reduction in investment levels due to lack of continuity and consistency in policies. Political instability law and order position in the major industrial centers, transport bottlenecks, as well as unreliability and inadequate availability of power supply at affordable rates were additional factors pulling down the sector.
The sector has shown impressive recovery recently and has grown at a compound rate of 10.9 percent per annum during 2001 – 05, with Large Scale Manufacturing (LSM) growing even faster, becoming 19.9% in 2005.
The contribution of Large-Scale Manufacturing at basic prices stand at Rs 844 billion as compared with Rs 264 billion in 2000-01, figures from the Census of Large-Scale Manufacturing Industries (CMI) 2005-06 show.
LSM contribution to GDP also called as Gross Value Added (GVA) at producers’ prices has been estimated at Rs 912 billion as compared with the previous Census 2000-01 amount of Rs 280 billion.Political and macroeconomic stability, rationalization of tariffs, increase in investments, improved utilization of productive capacity, and growth in demand for manufactured products, resulting from higher exports and consumer financing have been the major factors leading to this growth.
Large Scale Manufacturing
1999 and 2000 – 1.5%
2000 and 2001 – 11%
2001 and 2002 – 3.5%
2002 and 2003 – 7.2%
2003 and 2004 – 18.1%
2004 and 2005 – 19.9%
2005 and 2006 – 8.7%
2006 and 2007 – 8.6%
2007 and 2008 – 5%
Census of Large-Scale Manufacturing Industries
The contribution of Large-Scale Manufacturing at basic prices stand at Rs 844 billion as compared with Rs 264 billion in 2000-01, figures from the Census of Large-Scale...