In October, Foreign Direct Investment In Pakistan Fell 62% To $95 Million

KARACHI: According to data released by the central bank on Monday, net foreign direct investment (FDI) in Pakistan fell 62% to $95 million in October 2022 from $247.3 million in the same month the previous year.

Compared to the $84 million reported in September 2022, the net FDI increased by 13%.

Additionally, net FDI decreased by 52% year over year (YoY) to $348 million in 4MFY23. Compared to that, the FY2022 July–October period saw $726 million.

FDI inflows totaled $514.5 million from July through October of FY23, while FDI outflows were $166.2 million.

The largest investor, China, had a decline in total investment of 27% in the first four months of FY2023, according to a breakdown. With net FDI of $74.8 million as opposed to the $102 million invested during the same time last year, China contributed 14.5% of the overall share.

With a 13% investment, the UAE was the second-largest investor. In comparison to the same period previous year, its investment in Pakistan increased by 27.7% to $69 million from $54 million.

The energy sector attracted the largest amount of investment during the July–October period, accounting for over 30% of the total, or $155.5 million. The financial services industry came in second with $97.5 million, and oil and gas exploration brought in $18.5 million.

Despite financial backing of $1.5 billion from the Asian Development Bank and $1.3 billion from the World Bank, FDI remained subdued.

In contrast to September’s $363 million, Pakistan’s current account deficit expanded $204 million or 56% to $567 million for October 2022, but it shrank 68% year-over-year (YoY), mostly due to a persistent slowdown in imports and remittances.

According to data released by the State Bank of Pakistan (SBP) on Monday, during the first four months of this fiscal year (4MFY23), the current account deficit contracted by 47% year-on-year to $2.821 billion as compared to $5.305 billion during the same period of the previous fiscal.

Written by Aly Bukshi

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