KARACHI: The Foreign Direct Investment (FDI) in Pakistan continued to post a negative growth. It declined by 27 percent in the first seven months of this fiscal year (FY21). The State Bank of Pakistan (SBP) Monday reported that Pakistan fetched FDI amounting to $ 1.145 billion in July-Jan of FY21 compared to $ 1.577 billion in the same period of last fiscal year (FY20), depicting a decline of $432 million. During the period under review, FDI inflows stood at $1.792 billion against outflow of $ 647.2 million. The detailed analysis revealed that despite improved performance of equity market, the foreign investors are gradually withdrawing their investments from the stock market. The second component of foreign investment, ie, portfolio investment also witnessed a negative growth as portfolio investment registered outflow of $ 237 million during July-Jan of this fiscal year.

Similarly, total foreign investment in Pakistan, comprising foreign direct investment, portfolio investment and foreign public investment fell sharply 78 percent during the first seven months of current fiscal year. Pakistan’s total foreign investment declined to $755 million in July-Jan of FY21 compared to some $ 3.438 billion in same period of FY20, showing a decline of $2.683 million.

Although Chinese investment in Pakistan has slightly reduced compared to previous year, however, still China ranked first in the foreign direct investment arrived this fiscal year. Chinese investors invested some $ 403 million in Pakistan during the first seven months of this fiscal year. Netherland and Hong Kong with an investment of $220 million and $105 million were the major contributors in the FDI.

Month on Month basis, FDI amounted to $193 million was arrived in January 2021 versus $220 million in January 2020, depicting a decline of 12 percent or $27 million. During January 2021, FDI inflows were $257.2 million and outflows were $64.4 million.

Copyright Business Recorder, 2021