Karachi, January 17, 2024 – The State Bank of Pakistan (SBP) released a report on Wednesday, revealing a remarkable 35 percent surge in foreign direct investment (FDI) into the country during the first half (July-December) of fiscal year 2023-24.
According to the SBP, the FDI reached $863 million in the initial six months of the current fiscal year, a significant increase from the $640 million recorded in the corresponding half of the previous fiscal year. This surge in foreign direct investment reflects growing confidence among international investors in Pakistan’s economic potential.
The report highlights that foreign portfolio investment in the country’s capital market experienced an extraordinary surge, recording a 600 percent increase to reach $70.8 million in inflows during the first half of the current fiscal year. This contrasts sharply with the outflow of $14.2 million witnessed in the same period of the previous fiscal year. The robust performance of the capital market indicates a positive sentiment and increased foreign investor participation.
The total foreign private investment demonstrated a notable uptick, registering a 49 percent increase to $933.5 million during the first half of the fiscal year under review. This compares favorably to the $626 million recorded in the corresponding half of the last fiscal year, showcasing a substantial boost in private sector confidence and foreign investment.
Foreign public investment in debt securities also exhibited a positive trend, with inflows of $0.2 million during the first half of fiscal year 2023-24. This is a notable improvement from the outflow of $1.02 billion witnessed in the same period of the previous fiscal year. The shift in foreign public investment signals increased interest in Pakistan’s debt market, potentially driven by favorable economic conditions and attractive investment opportunities.
The overall foreign investment landscape in Pakistan experienced a threefold increase, with total inflows reaching $934 million during the July-December period of fiscal year 2023-24. This represents a significant improvement compared to the outflows of $393 million recorded in the corresponding period of the last fiscal year.
The surge in foreign direct investment is a positive indicator for Pakistan’s economic resilience and attractiveness to international investors. The government’s efforts to create a conducive business environment, coupled with economic reforms, appear to be yielding positive results. The diverse growth in various sectors, as reflected in both private and public investment, further contributes to the overall economic stability of the country.
As Pakistan positions itself as an investment-friendly destination, the surge in foreign direct investment is expected to have far-reaching positive effects on job creation, infrastructure development, and overall economic growth. The challenge now lies in sustaining this momentum through continued reforms and policies that foster a conducive environment for both local and international investors.
