Jul-Apr FDI slumps 31pc to USD1.409bn YoY
Pakistan's Foreign Direct Investment (FDI) sharply declined by 31% in the first 10 months of FY26, totaling $1.409 billion, primarily due to governance and policy uncertainties.
- Governance and policy uncertainties impacting FDI.
- Power and financial sectors as top FDI recipients.
- China, Hong Kong, and Korea as major FDI sources.
KARACHI: Foreign Direct Investment (FDI) in Pakistan declined sharply by 31 percent during the first 10 months of this fiscal year (FY26).
According to the State Bank of Pakistan (SBP), the country attracted USD 1.409 billion in FDI during July-April FY26, compared to USD 2.035 billion in the same period last year (FY25). During the period under review, gross inflows stood at around USD 3 billion, while outflows were recorded at USD 1.57 billion.
The decline reflects ongoing governance and policy uncertainties that continue to weigh on foreign investor confidence, the SBP noted in a recently issued report.
READ MORE: Jul-Feb FDI declines 33.4pc YoY: FD
Financial services and the power sector remained the main recipients of foreign direct investment. The power sector attracted the highest FDI, amounting to USD 786 million during the first ten months of FY26, followed by financial businesses with inflows of USD 659 million during July-April FY26.
These FDI inflows were largely sourced from China worth USD 739 million, followed by Hong Kong amounted to USD 256 million and USD 80 million from Korea in the first ten months of this fiscal year.
The SBP said these inflows were primarily due to the expansion of Islamic banking, attracting capital inflows from Kuwait and UAE, and continued inflows related to the licensing of the digital banks.
Total foreign investment in Pakistan was amounted to USD 32 million during July-April of FY26 compared to USD 1.46 billion in same period of last fiscal year.
Copyright Business Recorder, 2026
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