Govt Expects Big Industry to Continue Recovery in FY25

The Finance Division expects the large-scale manufacturing (LSM) sector to continue on its path to recovery during the current fiscal year 2024-25 (FY25). In its Monthly Economic Update & Outlook for July 2024, the finance division highlighted that LSM expanded by 1.0 percent during Jul-May FY24, compared to last year’s contraction of 9.6 percent. In May 2024, LSM registered growth of 7.3 percent year-on-year (YoY) and 7.5 percent month-on-month (MoM), driven by strong performance in food, apparel, leather, coke & petroleum products, chemicals, pharmaceuticals, and machinery and equipment. Additionally, cement dispatches experienced a 1.6 percent increase in FY24, totalling 45.3 million tonnes. Domestic dispatches accounted for 38.2 million tonnes, reflecting a 4.6 percent annual decline, while exports stood at 7.1 million tonnes, signifying a 55.7 percent yearly upsurge. However, compared to the previous year, local dispatches and exports declined in June 2024, reaching 3.1 and 0.58 million tonnes, respectively. The automobile sector struggled due to high interest rates and import restrictions, resulting in a 22.0 percent and 15.7 percent decrease in car production and sales, respectively. Similarly, truck and bus production and sales decreased by 30.5 percent each. “The recovery that began in the LSM will likely continue throughout FY25, driven by a stable exchange rate, macroeconomic stability, and relaxed import restrictions,” the report said.