- Total foreign investment up by 52.7% to $1.830bn
Pakistan’s foreign investment in July-Jan 2016-17 swelled up by 52.7 per cent to $1.830 billion, mainly supported by China that invested an amount of $245.3 million in the power sector.
During the period, the central bank received an amount of $1.024 billion in Foreign Public Portfolio Investment (Debt securities), which increased by 124.7 per cent during July-Jan 2016-17, the data released by the State Bank of Pakistan (SBP) said here on Wednesday. The Direct Investment (DI) has been improving for the last two months and it increased by 9.9 per cent to $1.161 billion in July-Jan 2016-17.
Out of this investment, the Dutch company FrieslandCampina invested an amount of $459.5 million in Engro Foods in December 2016, while the Chinese companies invested $245.3 million in power sector of the country in the last seven months. In the month of January 2017, the country has received $80.8 million through direct investment. The country recorded inflows of $138.8 million, while outflows of $58 million in January 2017 were recorded. In January, the Chinese companies poured in an amount of $34.3 million in the power sector.
Major investments were received from China, France, Hungary, Italy, Japan, Netherlands, UAE, USA and Turkey in different sectors. Meanwhile; Saudi Arabia, Norway, Bahrain, and Egypt pulled back their investment from Pakistan during the last seven months. In January 2017, the country received its biggest investment of $50.5 million from France and China made an investment of $33.6 million in development projects of the China Pakistan Economic Corridor (CPEC), the SBP’s document said.
An analyst of a brokerage house said, “Outflows of $354.7 million were recorded in the portfolio investment in equity securities, despite touching the highest level of 50,200 point level.” In Jul-Jan 2016-17, the foreign private investment of the country stood at $806.8 million, compared to $742.9 million received in the same period last year.
“The country’s total foreign direct investment increased by 52.7 per cent to $1.830 billion in the last seven months, only because of Netherland’s company’s investment in Engro Foods.” the analyst claimed. The country has received another big investment of $50 million from France. The data did not show where such investments are being made in Pakistan.
The country has recorded inflows of direct investment amounting $1.458 billion in Jul-Jan 2016-17, but the outflows were recorded at $297 million in the same period, the SBP data said. The analyst believed that a Chinese-led consortium will pay approximately $85 million against a 40 per cent stake of the Pakistan Stock Exchange (PSX) in a couple of weeks. He further said that the overall situation of FDI will improve in the coming months.
After touching the highest level of $24.6 billion, Forex reserves declined to $22.013 billion last week. The market had touched 50.200 points level at the PSX. There is a positive trend in the portfolio’s inflows due to the MSCI up-gradation of Pakistan’s stocks in emerging markets, another analyst claimed. During the last seven months, remittances of the country have also declined to $10.947 billion down by $208 million or 1.8 per cent, as compared to $11.155 billion received during the same period in the preceding year.
During January 2017, the inflow of worker’s remittances amounted to $1.488 billion, which is 6 per cent lower than that of December 2016 and 1.45 per cent higher than that of January 2016.
