The repatriation of profit and dividend by foreign investors registered a healthy growth of 65 percent during the first four months of the current fiscal year. Last fiscal year saw a constant decline in the repatriation of profit as global meltdown hit the profitability of companies, of which the outflow of profit and dividend posted some drop.
However, repatriation of profit and dividend is again on surge as foreign investors repatriated some $336.8 million on account of profit and dividend during July-October of FY12 against $204 million in corresponding period of last fiscal year, depicting an increase of 65 percent or $132.8 million. Bankers said the government has allowed 100 percent transfer of profit or dividend to foreign investors aimed at boosting foreign investment in the country.
They said rise in outflow of profit and dividend shows that Pakistan''s economy is improving and industrial activities being reinstated. State Bank of Pakistan said although repatriation of profit was registered from both components of foreign investment, the major outflow of profit and dividend was witnessed from the Foreign Direct investment (FDI) and cumulatively some 78 percent of repatriated amount was sent from FDI returns.
During the period under review, repatriation from FDI and Foreign Portfolio Investment (FPI) mounted by 63 percent and 73 percent, respectively. Foreign investors have sent abroad $261.3 million on account of return on FDI during the first four months of the current fiscal year as compared to $160.2 million in the same period of last fiscal year, depicting an increase of $101 million.
With a rise of $32 million, some $75.6 million was repatriated on account of return on portfolio investment during July-October of current fiscal year relative to $43.7 million in corresponding period of last fiscal year. Some 10 sectors of 36 showed an increase in the repatriation of profit and dividend. While, repatriation of 9 sectors witnessed downward trend.
The major repatriation was registered from the power sector where from foreign investors repatriated $53.7 million in first four months of FY12. Transportation is the second largest sector where from foreign investors sent an amount of $48 million during the period against some $10.6 million in the same period of last fiscal year.
Beverages, tobacco, sugar, leather, petrochemical, cement, electronics and information technology are those sectors where from not a single penny was sent abroad by foreign investors. Repatriation from food stood at $17 million, communication $36 million, chemical $11.5 million, textile sector $0.3 million, pharmaceutical $4.9 million and some $24 million were transferred from financial business by foreign investors on account of profit and dividend in first four months.