Karachi – Khurram Ijaz, General Secretary of the Businessmen Panel Progressive (BMPP) and former Vice President of the Federation of Pakistan Chambers of Commerce & Industry (FPCCI), has voiced strong concern over the surge in foreign profit repatriation at a time when Pakistan is experiencing a steep and worrying decline in Foreign Direct Investment (FDI).
He warned that the imbalance between inflows and outflows signals deep economic vulnerabilities that require urgent government attention.
According to the latest figures released by the State Bank of Pakistan (SBP), foreign investors repatriated $1.73 billion in profits and dividends during July–February FY26, marking a 10% increase compared to the same period last year. Meanwhile, FDI inflows fell sharply by 33.5%, dropping to $1.19 billion from $1.79 billion during the corresponding months of FY25.
“This mismatch is alarming,” Khurram Ijaz said. “When outflows rise and inflows fall, it signals eroding investor confidence and exposes structural weaknesses in our economy. Pakistan must not overlook this trend.”
He stressed that stability-driven policies and investor-friendly reforms must be prioritized to halt further deterioration in investment trends.
“The government must create a predictable, business-friendly environment so both foreign and local investors can operate with confidence,” he emphasized.
He added that unrealistic tax measures, inconsistent regulations, and the high cost of electricity, gas, and corporate taxes remain major contributors to declining investor sentiment.
Ijaz pointed out that several international brands have recently exited Pakistan due to rising operational challenges, particularly taxation disputes and soaring energy costs.
“If we don’t act now, more global players may withdraw — and the loss will be far greater than numbers on a balance sheet,” he cautioned.
He urged policymakers to introduce long-term tax frameworks, reduce the cost of doing business, and implement strong investor protection mechanisms.
“Pakistan cannot afford prolonged uncertainty. Restoring investor trust must be an economic priority,” he said.
Highlighting challenges in the capital markets, Ijaz noted that foreign portfolio investment (FPI) has also seen persistent outflows. During July–February 2025–26, Pakistan recorded $365.6 million in FPI outflows — significantly higher than the $253.6 million outflow in the same period last year.
He emphasized that these outflows occurred despite the Pakistan Stock Exchange trading at all-time highs, signaling declining confidence among foreign investors.
“When foreign investors exit even during a market boom, it reflects deeper concerns about economic stability and policy continuity,” he remarked.
Khurram Ijaz concluded by urging the government to adopt bold, practical, and long-term reforms to rebuild investor trust, stabilize the economy, and attract sustainable foreign investment.