Karachi, December 18, 2025 – Pakistan has reported a significant 25% decline in foreign direct investment (FDI) during the first five months of fiscal year 2025-26, according to the State Bank of Pakistan (SBP).
FDI inflows totaled USD 927.4 million from July to November FY26, down from USD 1.242 billion in the same period last year, marking a fall of USD 315 million. In November 2025 alone, net FDI decreased 16%, registering USD 180 million compared with USD 214 million in November 2024.
Foreign Portfolio Investment (FPI) and Foreign Public Investment also remained negative, with net outflows of USD 192 million and USD 422 million, respectively. Consequently, total foreign investment plunged 77% to USD 314 million in the first five months of FY26, compared to USD 1.391 billion in FY25.
Sector-Wise FDI Breakdown
• Power Sector: USD 384 million (highest FDI)
• Financial Services: USD 327.6 million
• Electrical Machinery: USD 58 million
Analysts emphasized that Pakistan needs concrete and sustained policy measures to boost FDI. They warned that weak foreign inflows could further strain the economy, especially as the country faces high external financing requirements.
Strong policy reforms and investor-friendly initiatives are seen as critical to reversing the declining FDI trend and ensuring sustainable economic growth.