The industrial sector of Pakistan is facing a huge blow due to the lapsing economy. While the government has managed to bring down the trade deficit by 35 percent, the impact on the local economy is great. With rising prices and increasing scrutiny of local businesses, the environment does not support local market growth. The Pakistan Bureau of Statistics (PBS) reported on Friday that the LSM index dipped by 7.06 percent in the second month of this fiscal year from a year ago. The decrease in LSM was mainly led by a dip of 14pc in petroleum products, followed by 12.82pc in the automobile sector, 12.58pc in non-metallic minerals, 9.96pc in fertilisers, 9.81pc in pharmaceuticals, 5.63pc in chemicals, 5.43pc in engineering, 5.10pc in iron and steel and 0.08pc in the textile sector.

These are glaring numbers that highlight problems within the local businesses and also speak volumes regarding the lack of local business acumen in the current Pakistan Tehreek-i-Insaaf (PTI) government. When the automobile industry started to show signs of distress, we put the blame on the rising automobile promises instead of recognising that the cost of production is going up in the market, whereas, revenue generation is decreasing across the board. The government needs to move swiftly in order to prevent further damage. A control on trade deficit should also result in the expansion of local businesses and local investment, which has seen a dip in the last two years.

Economic growth depends on the growth of the manufacturing sector particularly textiles. If the exports of the country along with manufacturing slows down, coupled with rising product prices, the government will not be able to sustain the trade deficit that it brought down. At this point, the trading community is also agitated along with the local businesses. The government needs to involve these stakeholders in the decisionmaking process in order to understand the circumstances under which they operate and to bridge the gap that can lead to development and growth.

Several businesses at this point in the country are being forced to lay off employees due to rising costs. The amount of unemployment the current policies are resulting in is exactly the opposite of what the current regime promised. These are all worrisome indicators that show a lack of economic vision on part of the government. With the Azadi March approaching, the government needs to find a mechanism to appease the local market.