Pakistan's industrial sector accounts for about 24% of GDP. Cotton textile production and apparel manufacturing are Pakistan's largest industries, accounting for about 66% of the merchandise exports and almost 40% of the employed labor force. Other major industries include cement, fertilizer, edible oil, sugar, steel, tobacco, chemicals, machinery, and food processing.

The government is privatizing large-scale industrial units, and the public sector accounts for a shrinking proportion of industrial output, while growth in overall industrial output (including the private sector) has accelerated. Government policies aim to diversify the country's industrial base and bolster export industries. Large Scale Manufacturing is the fastest-growing sector in Pakistani economy . Major Industries include textiles, fertilizer, cement, oil refineries, dairy products, food processing, beverages, construction materials, clothing, paper products and shrimp

In Pakistan SMEs have a significant contribution in the total GDP of Pakistan, according to SMEDA and Economic survey reports, the share in the annual GDP is 40% likewise SMEs generating significant employment opportunities for skilled workers and entrepreneurs. Small and medium scale firms represent nearly 90% of all the enterprises in Pakistan and employ 80% of the non-agricultural labor force. These figures indicate the potential and further growth in this sector.

The country’s export sector is choking fast and warrants innovative short and long term measures urgently to arrest declining exports that have already started widening the trade gap disproportionately. The issue gets compounded due to falling home remittances as well as foreign exchange reserves.

The country’s exports, which remained stagnant at $24-25 billion during 2010-11 to 2013-14, were declining for the last three years. The situation seeks exigent export oriented investment. How China and India have channeled foreign direct investment (FDI) to stimulate exports are good examples to follow to increase exports.

Earlier three year Strategic Trade Policy Framework (STPF 2015-18) announced by the PML(N) government did not help much to increase exports and discourage unnecessary imports. This STPF is said to have remained unimplemented as all the related efforts aimed at promoting exports could not produce any tangible benefit. Cash support schemes announced with all fanfare under STPF also proved unhelpful for improving product design and encourage innovation.

According to Economic Survey of Pakistan 2014-15, Pakistani exports remained stagnant at $24-25 billion and actually decreased in the year 2016 while Bangladesh’s exports surpassed the $30 billion mark last year and is set to hit $34 billion mark this year. This all is happening due to sluggish growth in Pakistan’s major trading partners – UK-USA and China – due to expensive gas/electricity that always delays in order deliveries.

Major exports including rice, cotton, leather, jewelry and the chemical sector have been hit hard by the slump in exports and the situation calls for drastic improvements. The government needs to help diversify exports whose current base is mostly limited to basic commodities like textiles, leather, cotton, grains, fruit etc. Making a transition from these exports to more value added goods in the global  value chain like computer chips, integrated circuits, semiconductors, parts used in mobile and laptop manufacturing and other high tech items seems imperative.

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