Problems of the industrial sector in Pakistan [Detail in 2022]

Problems of the industrial sector in Pakistan


Here we’ll explore the issues and problems of the Industrial Sector in Pakistan in 2022.

There include two types of industry that are construction as well as the manufacturing industry.  The construction and Manufacturing industry sectors are also called the secondary sector.



You know,  the industry is the second most important component of our economy in Pakistan after agriculture. 

New development in the industry is the backbone of increasing agriculture as well as other firms. It contributes more than 25% to our GDP.

So let’s discuss the main issue of the industrial sector


Important problems of the industrial sector in Pakistan

Although each industry in Pakistan has its own unique problems and solutions, our industrial sector as a whole faces the following major challenges.

  • Red tape
  • Tapping resources
  • Lack of government support.
  • Week planning of Tax benefits
  • Lack of material testing laboratories
  • Lack of research and development.
  • Lack of trained manpower
  • Credit services

So let’s start to learn it in detail…


Red tape foreign investors


Our bureaucracy is a replica of the old imperialist bureaucracy, which was especially for the British colonies not for industrial sectors, but we adopted it at a level that destroyed our economy.

When foreign investors intend to invest in Pakistan, they have to go through many bureaucratic hurdles. And in the end, these investors never come and invest in Pakistan.

Even worse is the situation of young entrepreneurs who do not have the budget to maintain all the industrial sector problems in Pakistan.


Tapping resources accelerate industrial

Oil exploration is the most important example of tapping resources in Pakistan.

This is also a major concern. The government of Pakistan should ensure that all unused minerals are mined and new businesses based on newly mined minerals be started to accelerate industrial development in the industrial sector.

Investors are making huge profits in Pakistan for the poor through research projects that limit profits. The Saindak project is an example of the exploitation of the poor. And there most of the profits were stolen by the investors and the locals were ignored.


Lack of government support.

Compared to other countries, our Government of Pakistan is not doing enough to help start new online businesses, offline businesses, and industries.

Our government should give loans to young entrepreneurs to start their own businesses, whether it’s offline or online.  They’ll give you more jobs opportunity.

The government should also provide land and make the bureaucratic system easier and more manageable for all Pakistanis.


Lack of Planning Tax benefits for new industries

Tax incentives are fundamental to the establishment of new industries. The government should establish industrial estates by exempting them from taxes and other such surcharges. It will definitely attract local and foreign investors to invest in our country.

Tax incentive policies in Pakistan are generally based on nepotism and self-interest.


Lack of material testing laboratories.

Pakistan lacks high-tech material testing laboratories. Most industries have to rely on foreign laboratories, resulting in huge costs. Material testing should be established to test the quality of the manufactured material.

This will lead to the production of high-quality materials to compete in the international market. The lack of such facilities puts our industry at a disadvantage compared to other countries.


Lack of research and development.

Lack of research is another major obstacle in our journey towards industrialization. Our industries lack the financial resources to conduct research and development.

Even if the industries make huge profits, they never support research because they want people to get all the profits without any compensation.

In some cases, the research work is sponsored but mostly on the terms and conditions that the research work will be biased.

There is also a lack of any concrete policy from the government and even if there are policies, they are difficult to implement. The government also provides limited funding for research work in the country.

Government support in this regard can be helpful for our industrial development.


Lack of trained manpower

Our workforce lacks the skills necessary for modern industry. Limited knowledge of old methods and techniques and modern high-tech industry cannot prove to be the right environment for large-scale industrial development.


Credit services to large industries

The lack of banks that can provide loans at low-interest rates is another major problem. Banks lend but mostly to large industries. Ordinary people are deprived of such facilities.


Steps are needed to Solve these issues

The government should take some steps to help keep our industry in tune with modern and advanced technology. Here are some of them:

  1. The government should introduce a bureaucratic system and provide one window operation to the investors instead of involving them in such a heavy process. One window operation will make it much easier for foreign investors to invest in our country.
  2. The government should find the natural resources that are abundant in our country. The services of foreign companies can be sought in this regard but the interests of the poor should not be compromised.
  3. The government should encourage local and foreign investors to build their own industries. Industries may be allowed to operate for a limited period of time with or without taxes.
  4. Industrial properties should be set up in the backward areas of the country. Large relief in terms of taxes should be provided to the industries. Establishing industry in backward areas can spread the message of industrial development to all parts and corners of the country.
  5. The government should also set up material testing laboratory work to help industries develop quality products.
  6. We must focus on research and development to compete with the developed world. Government funds can be helpful in this regard. Profitable industries should also be required to provide research grants to universities.
  7. Provide monthly and annual training courses to the workforce and start joint programs with engineering universities to help those entering the industry.
  8. Low-interest rate loans also need time. Small scale industries should be given priority as most of them lack funds.


Conclusion Problems of the industrial sector

Problems in the industrial sector are of great importance for the economic development of the country.

It is historical fact that countries with a strong industrial sector have shown more economic growth and development industrial sector has shown improvement in national income and promoted the living standard of the population.

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