PESHAWAR: The Pakistan Institute of Development Economics (PIDE) has released a groundbreaking report shedding light on the challenges faced by the engineering industry in the country.
The study, conducted by a team of researchers led by Dr Nadeem ul Haque, and including Dr Abid Rehman, Mohammad Armughan, and Dr Usman Qadir, delves into the realities faced by engineering companies and provides valuable insights into the state of the industry, PIDE press release said.
The report is based on an extensive survey of 328 engineering firms from across the Golden Triangle of Lahore, Gujranwala, and Gujrat.
It reveals statistics that highlight the critical concerns affecting the industry’s productivity and growth.
One of the foremost problems outlined in the report is the severe impact of electricity unavailability on daily production targets.
A staggering 83 percent of surveyed firms said that the unavailability of electricity creates hurdles in meeting their production goals, leading to a detrimental gap between demand and supply for the industry.
Additionally, 78 percent of these firms reported that electricity scarcity affects their operational efficiency, an important factor where economies of scale required to be achieved.
Load-shedding Affects Engineering Industry
Load-shedding and voltage fluctuations further exacerbate the issues by increasing the risk of machinery malfunctions and damage, affecting 68 percent of the firms.
The financial strain of arranging alternate supply, amounting to 71,000 rupees per unit annually, adds to the burden on the operations in firms, impacting 72 percent of the surveyed companies.
The report highlights the importance of addressing these challenges. It recommends that engineering companies adopt international and national quality standard certifications to maintain quality standards, a move endorsed by 89 percent of the surveyed firms.
In addition, the government is urged to focus on increasing the electricity supply in industrial areas, with smaller companies exploring backup power options to ensure uninterrupted operations, a sentiment echoed by 76 percent of the respondents.
An interesting finding of the report is the lack of an online presence among Pakistani engineering firms. With a surprising 63 percent of surveyed firms lacking any online presence, there is a need for businesses to establish themselves online to access a wider customer base and enhance engagement.
The study also reveals that while a considerable portion of firms, 63 percent show no intent to expand in the coming years, a proactive minority is planning to invest in advanced technology, machinery, land, and skilled labor to boost their business prospects.
