Pakistan's June FDI drops 94% as US outflows outweigh inflows

Pakistan's net foreign direct investment fell 94% month-on-month to $14 million in June 2026, from $214 million in May, according to State Bank of Pakistan data compiled by Topline Research.

Sizeable outflows from the food and electronics sectors and a sharp withdrawal by US investors outweighed inflows into power and financial services.

Why did Pakistan's FDI drop so sharply in June?

Pakistan's FDI dropped mainly because outflows from the food and electronics sectors, combined with a large pullback by US investors, outweighed the inflows the country received into power and financial services.

Overall net foreign investment recorded an outflow of $27 million in June, compared with an inflow of $446 million in May and $184 million in June 2025.

Which sectors drove the FDI outflows?

The food and electronics industries recorded the largest net outflows in June. The power and financial services sectors remained net recipients of foreign capital, partially offsetting the overall decline.

This split suggests the drop was concentrated in specific industries rather than spread evenly across the economy.

Which countries pulled the most investment out of Pakistan?

The United States posted a net outflow of $165 million in June, making it the largest source of capital withdrawals during the month.

China and Hong Kong remained the leading contributors to net inflows, continuing to offset some of the losses from other source countries.

How much FDI has Pakistan attracted in fiscal year 2026?

Despite the weak June performance, Pakistan attracted $1.64 billion in net FDI during fiscal year 2026, down from $2.48 billion in fiscal year 2025.

The year-on-year decline points to a broader slowdown in foreign investment beyond the single-month figures.

Is Pakistan's FDI decline a sign of weaker investor sentiment?

The June decline appears to have been driven largely by project-specific capital withdrawals rather than a broad-based deterioration in investor sentiment. Foreign investment continued to flow into strategic sectors such as power and financial services during the month. Even so, the sharp monthly drop and weaker annual FDI inflows point to Pakistan's continued struggle to attract sustained foreign investment.

A durable recovery is likely to depend on maintaining macroeconomic stability and ensuring policy consistency. Advancing privatization and energy-sector reforms, along with attracting greater investment from key regional partners, will also play a role.