Foreign Direct Investment (FDI) maintained upward trend and rose by 7 percent during the first two months of this fiscal year (FY16). Economists said the country has failed to attract massive FDI inflows due to several reasons including law and order, power crisis and unsustainable economic policies. During last fiscal year, FDI fell 58 percent mainly due to these issues, they added. According to State Bank of Pakistan's statistics release Tuesday, with an increase of $8.3 million, Pakistan fetched $119.3 million FDI during Jul-August of FY16 against $111 million in the corresponding period of last fiscal year (FY15).
During the period under review, FDI inflows amounted to $318 million against the outflow of $198.7 million. Moreover, the second component of foreign investment in Pakistan, ie, portfolio investment post negative growth owing to volatile equity market in recent days. Portfolio investment declined 164 percent in July-August of FY16. Overall portfolio investment stood negative $72.6 million in first two months of FY16 compared to $113.5 million investment in the corresponding period of FY15, showing a decline of $186.1 million. During the period under review, overall foreign investment in Pakistan, comprising FDI, portfolio investment and foreign public investment declined 80 percent. With current decline, net foreign investment in Pakistan stood at $37.7 million in July-August 2015 compared to $188 million in same period of last fiscal year, depicting a decline of $150.2 million.
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