Foreign investors repatriated USD 2.31 billion in profits and dividends from Pakistan during fiscal year 2025-26, as improved foreign exchange liquidity enabled multinational companies to clear earnings and dividend payments that had been delayed during the country's dollar shortage.
State Bank of Pakistan data released Monday showed total profit and dividend repatriation reached USD 2.305 billion during July-June FY26, up from USD 2.219 billion in FY25. The total included USD 2.202 billion in payments on foreign direct investment (FDI) and USD 103.7 million on foreign portfolio investment (FPI).
In June alone, foreign investors repatriated USD 151.4 million, including USD 140.6 million in FDI earnings and USD 10.8 million in FPI-related payments.
The increase comes as Pakistan's external position has strengthened over the past year, supported by higher foreign exchange reserves, record workers' remittances and improved U.S. dollar liquidity. The stronger external account has enabled the central bank to facilitate profit and dividend payments that had previously faced delays.
The manufacturing sector remained the largest source of profit and dividend outflows, with foreign investors repatriating USD 564.3 million during FY26, although that was down from USD 614.6 million a year earlier.
The financial and insurance sector ranked second, with repatriation rising to USD 537.4 million from USD 384.9 million in FY25, reflecting stronger earnings by foreign-owned banks and financial institutions.
The electricity, gas, steam and air-conditioning supply sector also recorded a notable increase, with outflows reaching USD 496.5 million, up from USD 401.7 million in the previous fiscal year.
Other major sectors included wholesale and retail trade at USD 211.6 million, information and communication at USD 166.9 million, transportation and storage at USD 162.1 million, and mining and quarrying at USD 124.6 million.
Smaller outflows were recorded from professional, scientific and technical activities, accommodation and food services, construction, agriculture, water supply and health services. No profit or dividend repatriation was reported from the real estate, education, or arts and entertainment sectors.
By country, the United Kingdom remained the largest recipient of profit and dividend remittances at USD 621.2 million, followed by China at USD 486.5 million. The United States received USD 191.4 million, the Netherlands USD 190.6 million, and the United Arab Emirates USD 150.3 million.
Analysts said the increase in profit repatriation reflects Pakistan's improving external liquidity rather than a deterioration in the balance of payments.
"The increase indicates the State Bank is in a stronger position to clear genuine corporate obligations that accumulated during the foreign exchange crisis," an economist at a Karachi-based brokerage said. "Timely profit repatriation enhances investor confidence and strengthens Pakistan's credibility as an investment destination, although sustained FDI inflows will remain essential to offset these outflows over the longer term."
Analysts added that while higher profit remittances increase foreign exchange outflows, they also reflect improved profitability of foreign-owned businesses operating in Pakistan and a more stable external payments environment.
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