Foreign investment in Pakistan slows down to $133 million in October

Net Foreign Direct Investment (FDI) inflow in Pakistan settled at $133 million in October, down 65.5% compared to net inflow of $385 million during September.

According to data issued by State Bank of Pakistan (SBP), FDI was recorded at $163 million in October last year.

However, in the first four months of the fiscal year, net FDI inflow increased 32% to $904 million compared to an inflow of $684 million in the same period last year.

Analysts believe that with the government introducing reforms and the establishment of the Special Investment Facilitation Council (SIFC), the country is prepping for flows of fresh foreign investment.

The future of FDI in Pakistan looks increasingly positive. Several global players are focusing on tapping into sectors like energy, mining, refineries, corporate farming, and exploration.

“As Pakistan’s macroeconomic conditions improve, we anticipate an acceleration in the inflows of foreign investments,” an analyst at Arif Habib Limited noted.

The highest inflow of FDI during four months came from China, which contributed $414 million. This was followed by Hong Kong with $100 million, the United Kingdom with $94 million, and the USA with $36 million.

Pakistan's population reached 241.5 million in 2023, a 31% increase from 184.4 million in 2013. This growth is expected to keep driving demand for commodities, attracting more foreign companies to the market.

Additionally, the government has deregulated prices for non-essential medicines and is considering the same for petroleum prices.

In the technology sector, plans for multiple IT parks and tech cities are in progress.

These steps are likely to spark foreign interest and investment in the pharmaceuticals, oil marketing companies (OMCs), and technology sectors.