KARACHI: Foreign Direct Investment (FDI) in the first eight months of 2017-18 amounted to $1.94 billion, up 15.6 per cent or $262.5 million from a year ago.
According to data released by the State Bank of Pakistan (SBP) on Friday, the country attracted FDI of $340.8 million in February, up 132.3 per cent from $146.7 million in the same month previous year.
China has been the primary foreign investor in recent years mainly because of the China-Pakistan Economic Corridor (CPEC). Investment originating from Beijing amounted to $1.28 billion in July-February, which accounts for almost 66 per cent of the total FDI received. SBP data shows that China invested $536 million in the same period in the last fiscal year.
Other than China, major investors were the United Kingdom ($205.5 million), Malaysia ($121.3 million), United States ($66 million), Switzerland ($57.7 million) and Hungary ($50.9 million).
Countries that pulled their investments from Pakistan during the same period were Norway ($125 million) and Kuwait ($25 million).
Pakistan received FDI worth $2.7 billion in 2016-17, which was 18.4 per cent higher than the preceding fiscal year. However, a major chunk of FDI flows received in 2016-17 belonged to a one-off transaction in which a Dutch company bought the majority stake in Engro Foods. Net FDI from the Netherlands in the preceding year was $460.8 million, accounting for almost 17 per cent of the annual flows.
More than 36 per cent of FDI in July-February came to the power sector, which is the centrepiece of CPEC. The power sector attracted net flows worth $711 million, up 91 per cent from a year ago. Within the power sector, the coal segment received a $585 million investment.
Construction has also been a primary focus for foreign investors’ as the sector received net inflows worth $471 million in the eight-month period, up 191 per cent from a year ago. Financial businesses received $230 million, followed by the oil and gas exploration sector ($138.6 million), trade ($58.2 million), cars ($45.5 million) and electronics ($33.4 million).
Investors pulled away almost $41.6 million from the communications sector, SBP data shows. Foreign portfolio investment, which includes funds invested in shares and debt securities, amounted to $2.4 billion, up 2.4 times from a year ago.