KARACHI: The country’s foreign direct investment (FDI) dipped by 46.4 per cent ($519.2 million) in July-October 2018-19 and stood at $600.7 million, as compared to $1.119 billion during the same period last year.
The total investments in the country during the first four months of Financial Year 2018-19 (FY19) stood at $331.3 million, registering a decline of 67.3 per cent when compared to the same period last year, the data released by the State Bank of Pakistan (SBP) revealed on Wednesday.
In October 2018, the country received only $161.2 million in the head of direct investment as compared to $354.6 million during the same month last year. Investments from China were recorded at $334.9 million, which was almost half of the total investment the country received during the last four months.
Total inflows of foreign direct investment of $844.8 million were received during the July-October period, while investors pulled back their $244.2 million.
“The government is waiting for the Saudi financial support, which is expected in a couple of days,” an analyst said. “The overall situation of the economy is little better as Saudi Arabia and China have assured their support to Pakistan. Finance Minister Asad Umar has also claimed that Pakistan is out of the financial payment crisis.”
After some improvement in the economy, he noted, the stock market gained over 2,000 points during the last month, with the KSE-100 index crossing the 40,000 points mark. People are still waiting for the new policies of Prime Minister Imran Khan, who took charge in August, the analyst claimed.
The analyst claimed that foreign investment in the country will start rising from this month (November), adding that the government was also negotiating to get $6-$8 billion from the International Monetary Fund (IMF) team, which was currently on a visit to Pakistan.
He, however, said that the federal government had raised the gas charges and the regulatory duty on import of 570 products, which would further hamper the country’s growth.
According to the SBP’s data, foreign private investment of the country stood at $331.1 million, down by 68.8 per cent during July-October as compared to $1.062 billion during the same period last year.
During July-October 2018-19, the SBP recorded outflows of $269.5 million in the head of Portfolio Investment (Equity Securities), down by 371.3 per cent as compared to the outflows of $57.2 million during the same period last year.
During the period under review, the SBP received an amount of $0.1 million in the head of Foreign Public Portfolio Investment (Debt Securities), increasing by 100 per cent during July-Oct this year, as compared to -$49.6 million during the same period last year.
The Chinese companies, under the China Pakistan Economic Corridor (CPEC), invested an amount of $334.9 million in July-Oct 2018-19, while the United Kingdom invested $64.5 million and Switzerland $36.3 million in Pakistan.
Major investment the country received were from USA ($45 million), Singapore ($17.1 million), Italy ($16.7 million), and Japan ($24 million). Meanwhile, Norway, Kuwait and Netherland pulled back their investments from Pakistan during the said period.