After the end of
Bhutto regime the new government, initiated a large number of measures for
growth of industrial sector. At first step, to encourage investment in large
industries by private sector, many nationalized industries like, flour mill,
rice husking and cotton ginning were denationalized. It was also declared that
no further nationalization of private industries will be done: Private
investment in large-scale industries was encouraged. The investment situation
gradually strengthened in the country. Due to all these measures, the annual
growth of manufacturing sector rose upto 8.2% in the 1980’s.
In the past decade
(1990-2000), there were many development measures taken by the previous
government, e.g., small industrial estates, duty free import of modern
technology, incentives to domestic industries etc.
Due to the
encouraging industrial policy for the private sector, the over all
manufacturing has staged an impressive recovery during the decade 1990-2000.
The growth rate of
large-scale manufacturing was 4.7% in the first half (1990-95), while it down to an average of
2.5% in the second half of the 1990’s. During 1999-2000, the manufacturing has
grown by 7.8%. The overall manufacturing grew by 7.1% in the fiscal year
2000-01. The share of industrial sector was 18.4% to the GDP during 2007-08.
The large-scale industrial growth rate was 35%, 7.2%, 18.1% and 19.9% during
2001-02, 2002-03, 2003-04 and 2004-05. The overall manufacturing recorded
growth of 9.9% in 2005-06 and 8.45% in 2006-07, while it was 4.8% during
2007-08. The sluggish growth in industrial sector (Large scale) was due to
severe energy shortages, deterioration in domestic law and order situation and
sharp depreciation in rupee vis-a-vis US dollar and most importantly, weak
external demand due to global recession.
Overall
manufacturing sector posted a negative growth rate of 3.3% during the fiscal
year 2007-08.