Karachi, March 16, 2026 – Pakistan’s foreign direct investment (FDI) inflows declined by over 33% during the first eight months of the current fiscal year 2025-26, the State Bank of Pakistan (SBP) reported on Monday.
According to SBP data, FDI dropped to $1.19 billion from $1.79 billion during the same period of FY25, reflecting a 33.51% decrease.
Analysts at Topline Securities Limited estimate that FDI for the full fiscal year FY26 could reach $2.5 billion, depending on investment trends in the remaining months.
Portfolio Investment Sees Continued Outflows
The country’s portfolio investment in the stock market continued to experience outflows during July–February 2025-26, totaling $365.6 million, compared with $253.6 million in the same period last year.
Similarly, portfolio investment in government securities recorded an outflow of $125 million, compared with an inflow of $42.6 million in FY25.
Private and Public Investment Trends
• Total private foreign investment fell to $829 million, down from $1.54 billion in the previous year.
• Combined private and public investment dropped to $704 million, compared with $1.58 billion in the same months of FY25.
Positive Uptick in February 2026
Despite the overall decline, February 2026 recorded growth in FDI inflows:
• FDI inflows increased to $213.5 million from $132.7 million in February 2025.
• Total private foreign investment rose to $135.5 million, compared with $111.1 million last year.
• Portfolio investment in government securities saw an inflow of $51.2 million, compared with an outflow of $12.4 million in February 2025.
• Combined private and public investment reached $186.7 million, up from $98.8 million in February last year.
Major Contributors and Sectors
According to Topline Securities, the largest contributors to February FDI were China, Hong Kong, and Switzerland. Sector-wise, the Power, Electronics, and Financial businesses secured the highest FDI during the month.
Economic Implications
The decline in FDI and portfolio investment underscores ongoing challenges for Pakistan’s investment climate amid global economic uncertainty and domestic policy issues. Analysts note that while February’s recovery provides a positive signal, policy stability and investor confidence will be crucial for reviving foreign investment inflows and strengthening Pakistan’s financial markets.