The document discusses the major industries in Pakistan's industrial sector and the issues facing its growth. It notes the industrial sector has grown at an average annual rate of 5.8% over 32 years. Key issues hindering faster growth include a lack of capital due to low savings rates, inadequate infrastructure like roads and communications systems, political instability and changing policies, technological backwardness, energy crises, low foreign investment, high inflation, limited domestic and international markets, low literacy rates, and insufficient raw material production to support agro-based industries. Suggestions are provided to address these issues and boost industrial sector performance through improved policies, financing, infrastructure, energy supply, security, technology, and skills development.

1. Beside the above five major industries, following are also the main industries of pakistan
industrial sector:
 Vegetable ghee and cooking oil industry
 Chemical industry
 Jute industry
 Mining industry
 IT industry
 Live stock industry
 Engineering and electronics items industry
 Food, beverages and tobacco industry
 Petroleum industry
Issues faced by Industrial sector
As we see in previous section the average annual growth rate of Pakistan industrial sector for last
32 years is just 5.8 %. The reason is industrial sector faces many issues and difficulties in
previous years. In this section we discussed the main issues which are responsible for low growth
rate of industrial sector in last three decades:
Lack of Capital:
One of the most important problems is lack of capital. Industrial sector facing problem in growth
and expansion because the required capital is not available and the reason of less availability of
capital and other financing opportunities is less saving. As a nation we consume more and save
less. Saving rate of Pakistan is just 15% if we want to rely on our domestic resources then it is
essential to increase saving rate. Without saving capital for investment is not available.
Inadequate Infrastructure:
Good infrastructure is essential for sound industrial sector but in Pakistan unfortunately no
proper infrastructure available for industrial units. No proper road networks available that meet
the industrial units with local markets. Communication system plays important role in

2. establishment of industry but in Pakistan communication system is poor and costly. Beside this,
there is no proper system of sanitation and how to dispose of waste etc.
Political Instability:
From the beginning Pakistan political environment is unstable. Government changes rapidly and
every new Government adopt new policies and removes the previous ones. This discontinuity
affects the performance of industrial sector when industrial strategies changes again and again
because of change of Government.
Technological Backwardness:
We are living in a modern world of 21st century and still use the old methods and techniques in
every field of life and the reason is we are not having technical knowledge. Using the old
technologies in industrial sector because of less availability of technically sound workers
defiantly leads to low production with high cost.
Energy Crisis:
Especially in last decade the problem of unavailability of electricity, oil and gas increased.
Without providing smooth availability of energy facilities, it is impossible for industry to grow
with good growth rate. Because of this problem exports sector not meeting the foreign demands.
Reason of less electricity supply as compared to its demand is we are not having Dams, over line
losses is too much, distribution system is not efficient and the main one is we are not focusing on
alternative methods available for generating electricity.
Low Foreign Investment:
Not only domestic investment is less, foreign investment available to industry also too much less.
Because of poor law and order situation in a country, foreign investors not ready to invest in our
country. Total foreign investment available to industrial sector is almost 0.5% of GDP only. Low
rate of foreign investment play a big role in less growth rate of industrial sector.
High Inflation Rate:

3. Due to high interest rate and inflation rate industry also suffer because it will increase the cost of
business by increasing the cost of capital. It shows the negative impact on foreign investor. In
Pakistan, inflation rate is high from many years. There is no special relief in interest rate for
industrial sector as the case in India. India provides special relief to industrialists to promote the
industrial sector.
Limited Markets:
Another issue is the markets available for industry is limited because of high cost of doing
business and low quality as compared to competitors our products no one ready to buy. New
competitors especially India and china capture the major market share by providing better quality
products with less price.
Low literacy rate:
Because of low literacy rate labor available for industry is not efficient. Without having skills,
productivity of labor is not possible to increase and low productivity of labor directly affects the
performance of industrial sector.
Low production of Raw Material:
Pakistan industrial sector have mostly agro-based industries which uses the production of
agriculture sector as raw material. Low production of agriculture sector leads to unavailability of
raw material on less prices for industrial sector and it will reduce the growth rate of industrial
sector.
Suggestions to Overcome the Issues of Industrial Sector:
As we discussed in previous section industrial section faces multiple issues or problems which
affects the growth of sector, in this section we recommend how to resolve these issues and
increase the performance of industrial sector. Following are the important measures to put the
industry on sound basis:
 Make well planned strategies and policies that are able to run the industrial sector in
efficient way.

4.  Provide loans on easy installments with low interest rate to industrialists and increase
credit and other financing facilities to fulfill the need of capital for investment.
 Improve infrastructure especially establish road networks to link industrial units with
markets.
 Make sure the supply of electricity to industrial sector by increasing the electricity
generation through focus on alternative methods to produce electricity.
 Improve law and order situation to increase the foreign investment. Create such
environment in a country in which foreign investor feel secure.
 Establish new industrial estates to expand the size of industry and provide tax concession
to investors in investing in new industrial estates.
 Make economic condition of a country healthier through better fiscal and monetary
policy. It will help in increasing the investment in industrial sector also.
 Provide sufficient and cheap raw material to industry to lowering the cost by increasing
the production of raw material.
 Explore new markets for industrial products and increase the quality of local
manufactured products to compete in foreign markets.
 Using the advanced technologies to increase the efficiency. It will help in lowering the
cost and increasing the output.
 Increase technical institutions and provide skills to labor to increase the productivity of
labor.
 Focus on increasing the exports and especially on decreasing the imports by making
imports substitute goods in local industries.