Pakistan’s Large Scale Manufacturing (LSM) Index showed a modest 0.4 percent year-on-year increase in December 2025, alongside a strong 9.3 percent month-on-month growth, signaling a rebound in industrial activity. During the first half of fiscal year 2026, the LSM index expanded by 5 percent YoY, indicating improving momentum across the manufacturing sector.
The growth in December was largely driven by a 31 percent year-on-year surge in automobile production, supported by 9 percent growth in wearing apparel, 3 percent increases in cement and non-metallic minerals, and a 2 percent rise in textiles output. Several sectors, however, recorded declines, with fertilizer production falling 10 percent YoY, pharmaceuticals and food production decreasing by 6 percent each, and petroleum and coke output dropping 5 percent YoY.
Topline’s GDP growth assessment, released at the end of December 2025, revised Pakistan’s LSM growth target for FY26 upward to 4.0 percent from an earlier projection of 2.5 percent, reflecting improved industrial performance and a stronger outlook for the manufacturing sector.
