KARACHI: Net foreign investment in Pakistan fell 8.6 percent to $1.534 billion in the first 10 months of the 2010/11 fiscal year because of a decrease in foreign direct investment, the central bank said on Monday.
Foreign investment totalled $1.678 billion in the same period last year.
Foreign direct investment fell 28.6 percent in the July-April period to $1.232 billion from $1.724 billion in the same period last year, the State Bank of Pakistan said.
Pakistan's unstable security, a Taliban insurgency in the country's northwest and chronic power shortages have put off long-term investors, analysts say.
However, with emerging markets increasingly on the radar of fund managers, Pakistan has seen a flow of foreign investment in the country's main stock exchange.
Foreign portfolio investment rose 749.5 percent to $302 million in the first ten months of 2010/11, compared with an outflow of $46.5 million in the same period last year.
Pakistan has struggled with a troubled economy and an International Monetary Fund (IMF) emergency loan package agreed in November 2008 helped it avert a balance of payments crisis and shore up reserves.
It received the fifth tranche of $1.13 billion of the $11 billion loan in May 2010. Pakistan and IMF authorities are in Dubai to discuss the release of the next tranche and budget targets for the 2011/12 fiscal year.
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