THE PAKISTAN DEVELOPMENT REVIEW
Industrial Production and Investment in Pakistan
Development in Pakistan so far has been largely sustained by a rapidly growing industrial sector. From 1953 to 1960, the index for manufacturing has grown more rapidly in Pakistan than in any other country for which United-Nations statistics are published, except Japan. Admittedly, the reliability of such comparisons is limited and the high rate of Pakistan’s industrial growth is partly a function of the low initial level of industrial development—if you start at zero, any increase means an infinite rate. But the United-Nations index starts in the middle 1950’s when Pakistan already had a respectable industrial sector and the statistics are sufficiently reliable so one can say with some confidence ‘ that Pakistan had a rate of industrial growth matched by few countries in the recent past. A reasonably accurate measure of the growth in industrial production and investment in Pakistan is, therefore, of particular importance to economic analysis, policy formulation, or planning. The dynamism of the industrial sector has been due to what is called ” large scale industry “. No reasonably reliable information exists on value added in “small scale industry”, but various official , and unofficial guesses on its growth rate have ranged from a decline to a 3.5- per-cent annual increase. There would be near-universal agreement that “large scale industry” has grown much more rapidly than “small scale”. The Survey, discussed later in this paper, confirms this conclusion. From 1947 to 1959, the value added by firms with assets of less than one million rupees increased only five-fold, while that added by larger firms increased more than fifteen times.