KARACHI: Foreign Direct Investment (FDI) in Pakistan surged by 32 percent during the first four months of the current fiscal year (FY25), signaling a positive trend for the country’s investment climate.

According to the State Bank of Pakistan (SBP), FDI inflows, from July to October 2024, totaled $904.3 million, up from $683.5 million during the same period in FY24, showing an increase of $221 million. The data reveals that total foreign investment inflows for the period amounted to $1.242 billion, while outflows stood at $338 million.

However, FDI performance showed a decline in October 2024 compared to the same month last year. FDI in October 2024 was $133 million, down from $163 million in October 2023.

While FDI growth was strong, portfolio investment, despite an improved performance in the equity market, faced challenges. Pakistan saw a $97.2 million outflow in portfolio investment during the first four months of FY25, compared to a modest $11 million inflow during the same period in FY24.

Overall, the total foreign investment in Pakistan, which includes FDI, portfolio investment, and foreign public investment, surpassed the $1 billion mark, driven largely by the increase in FDI.

Total foreign investment for the period reached $1.09 billion, representing a significant 56 percent increase from $698 million in the corresponding months of FY24.

Analysts, the uptick in foreign investment is seen as a positive sign for Pakistan’s economic recovery, though analysts are keeping a close watch on the ongoing challenges related to portfolio investment outflows and broader market conditions.

Copyright Business Recorder, 2024