Karachi, September 18, 2024 – Pakistan has experienced a remarkable 55.5% surge in foreign direct investment (FDI) during the first two months of the current fiscal year 2024-25, according to data released by the State Bank of Pakistan (SBP) on Wednesday. This sharp increase signals renewed global confidence in Pakistan’s economic outlook, driven by various policy reforms and improved investment conditions.
The SBP reported that total FDI reached $350.30 million during the July–August period, compared to $225.2 million in the same period of the previous fiscal year. This growth highlights the success of the government’s efforts to attract foreign investment by streamlining regulations, enhancing infrastructure, and creating a more investor-friendly environment.
A notable contributor to this surge was the inflow of portfolio investment into the capital markets, which grew by 8.1%, amounting to $24.7 million during the first two months of FY25, up from $22.8 million in the same period last year. This reflects increasing interest from international investors in Pakistan’s stock market and signals optimism about the country’s financial markets.
The overall net foreign private investment into Pakistan, which includes both direct and portfolio investments, saw a significant jump of 51.2%. It rose to $374.9 million during the July–August period, compared to $248 million during the corresponding months of FY24. The growth in private investment demonstrates a strong appetite among foreign investors to participate in Pakistan’s diverse sectors, ranging from manufacturing to services.
In addition to private investments, foreign public investment into Pakistan, particularly in debt securities, saw a remarkable increase. The inflows surged to $78.2 million during the first two months of FY25, compared to a mere $3.9 million in the same period last year. This boost in public investment is largely attributed to Pakistan’s efforts to raise capital through government bonds and other financial instruments, which have garnered interest from international investors seeking stable returns.
The strong FDI inflows are expected to support balance of payments of Pakistan and provide much-needed foreign exchange reserves at a time when the country is navigating economic challenges. The government’s ongoing reform agenda, which includes improving ease of doing business, attracting investments in infrastructure, and fostering public-private partnerships, has contributed to this positive trend.
As Pakistan continues to strengthen its economic fundamentals, the substantial increase in foreign investments during the first two months of FY25 is a promising sign of sustained growth and increased international confidence in the country’s economic potential.
