ISLAMABAD - Continuing on its strong growth trajectory, the electronics industry posted a growth of 7.8 percent during the first quarter (Q1) of fiscal year 2018-19, State Bank of Pakistan (SBP) reported. The uptick was driven primarily by an increase in the production of electric motors and various cooling equipment, said SBP first Quarterly Report on the State of Pakistan’s Economy for FY19. Improvement in electricity supplies alongside an extended summer season drove the demand for the electronic goods. The consistent growth of the segment has attracted the attention of the foreign investors as well. For instance, TCL, the third largest television set producer in the world, has announced plans to expand its footprint in the Pakistani electronic market, it added. The country’s large scale manufacturing (LSM) witnessed a broad-based contraction of 1.7 percent, the report added. Overall, macroeconomic environment, according to the report, remained challenging during the first quarter of FY19 as suggested by the preliminary data.

The primary concern was the steep rise in global crude prices, which not only reinforced the already strong underlying inflationary pressures in the economy, but also eclipsed emerging improvements in the external sector.

Fiscal pressures also remained intact as expenditure rigidities allowed only a limited room for the government to maneuver.  Responding to these challenges, the new political regime immediately announced cuts in development spending, partially reversed tax relief measures, and also explored avenues to bridge the external financing gap.