Repatriation of profit and dividends by foreign investors was a massive 237% higher on a year-on-year basis during the first eight months of the ongoing fiscal year (July-February FY24), with the amount standing at a whopping $759.2 million compared to $225.4 million in the same period of the previous year.
The State Bank of Pakistan (SBP) on Wednesday reported that foreign investors repatriated an amount of $64.9 million in February alone, compared to a meagre $4.9 million in the same month of 2023.
On a month-on-month basis, the repatriation of profits and dividends by the investors was $64.9 million in February 2024. This included $64.5 million as return on FDI and an amount of $0.4 million as return on FPI.
H1FY24: Profit repatriation up record 161pc to $567.7m YoY
As per market experts, the notable increase in profit and dividend outflow is attributed to some relaxation on capital controls that were imposed by the SBP last year due to foreign exchange crisis in the country.
They added that the rising trend in repatriation amount is expected to continue in coming months.
Back then, the central bank imposed a number of restrictions to manage foreign exchange reserves of the country to avoid default. Pakistan also secured a last-minute bailout in the shape of a $3-billion Stand-By Arrangement with the International Monetary Fund (IMF), which paved way for financing from other multilateral and bilateral lenders. The developments helped avert a sovereign default and build reserves of the SBP that now stand at over $8 billion.
Meanwhile, a detailed analysis revealed that repatriation on account of FDI surged to $703.7 million during the first eight months of this fiscal year compared to $188.5 million in the same period of last fiscal year, an increase of $515.2 million.
Foreign investors: Jul-Nov profit repatriation soars 312pc to $532m YoY
Similarly, $55.5 million was paid abroad on account of FPI during July-Feb of FY24, up from $37 million in the corresponding period of last fiscal year.
Sector-wise data revealed that the highest outflow amounted to $126.4 million, and was made from the petroleum refining sector. Power sector stood second with $109.1 million repatriation in the first eight months of this fiscal year. With $104 million outflows, the financial business sector ranked third.
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