KARACHI: Foreign Direct Investment (FDI) into Pakistan dropped by 22 percent in the first two months of the current fiscal year (FY26).
According to the State Bank of Pakistan (SBP), the country received USD 364.3 million in FDI during July-August FY26, compared to USD 467 million in the same period last fiscal year (FY25), showing a decline of USD 103 million.
During this period, gross FDI inflows fell by16 percent to USD 560 million, while outflows also declined 2 percent to USD 196 million. On a month-on-month basis, FDI contracted sharply by 43 percent, falling to USD 156 million in August 2025 from USD 272.4 million in August 2024.
The country-wise breakdown shows that China remained the largest source of FDI, contributing USD 120 million during the first two months of FY26.
However, this marked a steep decline from USD 254 million in the same period of last year. Hong Kong ranked second with USD 60 million investment in July-Aug of FY26 down from USD 86 million in corresponding period of last fiscal year.
Meanwhile, Foreign Portfolio Investment (FPI) also followed a downward trajectory, recording a net outflow of USD 75 million in July-August FY26, compared to an inflow of USD 25 million in the corresponding period of FY25.
As a result, net foreign investment, which includes FDI, portfolio investment, and foreign public investment, fell by 51 percent or USD 292 million to USD 278 million in the first two months of FY26, down from USD 570 million in the same period of the previous fiscal year.
Copyright Business Recorder, 2025
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