The recent report by the Pakistan Institute of Development Economics (PIDE) on Industrial Units revealed that a ma­jority of these units have suspended their plans to ex­pand due to the non-availability of electricity. The unavailability of electricity, an increase in the risk of machinery malfunctions, and the detrimental effects of political instability and unfavor­able economic decisions have all impacted industrial productiv­ity and played an unfortunate role in this decision. 

The PIDE report revealed that 83% of surveyed firms identi­fy the unavailability of electricity as a major hurdle in achieving their production goals. The resulting gap between demand and supply has detrimental effects on the industry. Load shedding and voltage fluctuations further worsen the situation, which raises the risk of machinery malfunctions and damage, impact­ing 68% of firms. 

The financial strain of arranging alternate electricity supply imposes an additional burden on industrial units, amounting to approximately Rs71,000 per unit annually. Moreover, the major­ity of firms lack access to credit due to inadequate collateral, hin­dering their ability to secure loans. Only 5% of surveyed compa­nies reported having loans or lines of credit, exacerbating the challenges faced by the industry. 

To foster economic growth, a thriving relationship between the government and the business sector is crucial. However, political instability and unfavorable economic policies have led to a lack of trust and dissatisfaction among business owners. This alienation negatively impacts productivity and profit mar­gins. It is imperative that the government takes initiative in re­viving this relationship to provide an environment conducive to industrial growth. 

Expansion is vital for economic growth, and industrial units play a crucial role in generating revenue. It is essential for the gov­ernment to support these units amidst financial constraints while adopting a new economic policy direction for Pakistan. Although specifics may vary, potential measures could include ensuring a reliable electricity supply, offering financial incentives for ex­pansion, and providing easier access to credit for small-scale en­terprises. By taking such necessary steps to alleviate these chal­lenges, Pakistan can create a favorable environment for industrial expansion and secure a brighter future for the sector.