KARACHI: Foreign Direct Investment (FDI) posted 12 percent growth during the first five months of this fiscal year (FY22).
The State Bank of Pakistan (SBP) reported Friday that Pakistan fetched FDI amounting to $797.7 million during July-Nov of FY22 compared to $710.3 million in the same month of the previous fiscal year (FY21), depicting an increase of $87.4 million. During the period under review, FDI inflows were $1.185 billion against $387.7 million outflow.
FDI wason decline since the beginning of this fiscal year and down 12 percent in the first four months (July-Oct) of this fiscal year. However, with healthy inflows from Netherland, the United State and UK, foreign direct investment is showing improvement, despite massive fall in Chinese investment. For the last few years, China was the leading and largest investor due to CPEC-related projects.
Country wise data showed that Netherland is the largest investing country with an investment of $153 million, up 325 percent. Although, Chinese investment declined sharply 55 percent during first five months of current fiscal year, however still China is ranked second with $149 million foreign direct investment in Pakistan. Investors from the US and UK invested $190 and $66 million during July-Nov of FY22.
The second component of foreign investment, ie, portfolio investment remained negative with an outflow of $ 263.2 million during the first five months of the current fiscal year.
Total foreign investment in Pakistan, comprising foreign direct investment, portfolio investment and foreign public investment surged by 73 percent during the period under review.Pakistan’s total foreign investment rose to $455.5 million in July-Nov of FY22 compared to some $263.4 million in the same period of FY21, showing an increase of $192.1 million.
Month-on-month basis, Pakistan received $135.6 million FDI during November 2021 compared to $40.3 million outflow in November 2020, showing an increase of $95.3 million in a month.
It may be mentioned here that at present the country needs healthy foreign inflows to support the external account, which is under pressure due to rising trade deficit followed by higher import bill.
Copyright Business Recorder, 2021