The net foreign direct investment (FDI) into different sectors like power, communications and oil and gas exploration dropped 24 per cent to $223 million in October 2021.
According to the data compiled by the State Bank of Pakistan (SBP), FDI declined by 11.8pc YoY to $662.1 million during 4MFY22, i.e., July to October, as compared to FDI of $750.6m reported in the corresponding period last year.
During the month of October, the foreign private investment into the country amounted to $145m, out of which $223m was attributed to direct investments, whereas disinvestment of $78m was attributed to equity securities i.e., a part of portfolio investments.
Within the direct investments, there was an inflow of $299.6m and an outflow of $76.6m during the month.
Under the foreign public investment, $1bn worth of disinvestment was witnessed in debt securities during October’21 against the outflow of $243.7m in Oct’20 and inflows of $3.3m recorded in Sep’21.
All in all, the country witnessed doreign divestments of $894.9m in Pakistan during the month when compared to net inflows of $12.3m in Oct’20 and $153.8m in September.
According to Bloomberg, the rupee has become Asia’s worst performer in the past six months.
The government earlier predicted that Pakistan’s economy will slowly and gradually gain growth momentum, which should encourage foreign investors to invest in new projects, however, the figures do not support the claim.
The overall weak global trends were also responsible for the tepid FDI inflows into Pakistan.
The Netherlands was the largest foreign direct investor in Pakistan as it invested $160.5m in the first four months of FY22. China emerged as the second biggest investor as it invested $116.5m compared to an investment of $399.5m in the same period last year while the United States emerged as the third-largest investor with an investment of $114.3m compared to $27.7m in the corresponding period last year.
Investment from Hong Kong clocked in at $45.5m.
