Pakistan’s Large Scale Manufacturing (LSM) sector registered a 5.77 percent growth during July–May FY2025-26, with engineering-related industries presenting a mixed performance despite an overall improvement in industrial output, according to provisional data released by the Pakistan Bureau of Statistics (PBS).
The Quantum Index of Manufacturing (QIM) stood at 116.10 points in May 2026, reflecting a 1.21 percent month-on-month increase, although it remained 0.98 percent lower compared to May 2025.
The automobile industry emerged as the strongest contributor among engineering sectors, recording an impressive 20.81 percent growth in May and a cumulative 58.82 percent increase during July–May FY26. Electrical equipment manufacturing also contributed positively to overall LSM growth with 0.35 percent, while machinery and equipment posted marginal positive growth.
However, key engineering and construction-related industries remained under pressure. The iron and steel sector declined by 12.57 percent in May and 7.49 percent cumulatively, reflecting subdued demand from construction and industrial projects. The cement industry also recorded a 9.36 percent monthly decline and 7.16 percent cumulative contraction, highlighting continued challenges facing the construction sector despite improving manufacturing activity.
Petroleum products, an important industrial input, registered strong growth of 15.75 percent in May and 10.56 percent cumulatively, supporting manufacturing and transport activities across the country.
According to PBS, the overall expansion in LSM was primarily driven by automobiles, food, sugar, garments and petroleum products. The automobile sector alone contributed 1.53 percentage points to the overall 5.77 percent growth, underlining its growing importance in Pakistan’s manufacturing landscape.
The latest figures indicate that while engineering manufacturing segments such as automobiles and electrical equipment continue to expand, construction-linked industries including cement and iron and steel will require stronger investment activity to sustain broader industrial growth.
