Foreign investors: Jul-Nov profit repatriation soars 112pc to $1.129bn YoY

KARACHI: The repatriation of profits and dividends by foreign investors has soared by 112 percent during the first five months of the current fiscal year (FY25), driven by improving economic conditions and investor confidence.

According to State Bank of Pakistan (SBP) foreign investors operating in Pakistan repatriated $1.129 billion on account of profit and dividend in July-Nov of FY25 compared to $ 523 million in the same period of last fiscal year (FY24), depicting an increase of $597 million.

A detailed analysis shows that a large amount of the repatriated funds was as return on Foreign Direct Investment (FDI). Foreign investors sent $1.074 billion abroad as FDI returns during July-Nov of FY25, marking a significant increase of 118 percent, or $582 million, compared to $492 million in the corresponding period of FY24. Meanwhile, returns on Foreign Portfolio Investment (FPI) totaled $54 million, up from $41 million last year.

Foreign investors: Jul-Oct profit repatriation soars 66pc to $807.2m YoY

Analysts said this significant rise highlights the growing returns on foreign investments in Pakistan, supported by improved economic fundamentals and stronger financial performance across key sectors. Experts believe this trend highlights Pakistan’s potential as a profitable investment destination, which could further enhance its ability to attract additional foreign capital.

On a month-on-month basis, $322 million were repatriated in November 2024 alone, including $302 million on FDI returns and $20 million on FPI.

Sector-wise data revealed that, the food sector accounted for the highest outflow during the first five months of this fiscal year, with $247 million repatriated in profits and dividends-an almost fourfold increase from $68.6 million in the same period of FY24.

The financial sector followed with $160 million in repatriations, while the power sector ranked third, recording outflows of $157 million in the first five months of FY25.

Copyright Business Recorder, 2024