Karachi, April 17, 2025 – The State Bank of Pakistan (SBP) on Thursday released its latest data, revealing a 14% increase in foreign direct investment (FDI) during the first nine months (July–March) of the ongoing fiscal year 2024-25 (9MFY25).
According to the SBP, total FDI during this period reached $1.64 billion, up from $1.44 billion in the same period of the previous fiscal year.
The SBP emphasized that this growth in FDI reflects a degree of sustained investor confidence in key sectors of the economy such as energy, telecom, and manufacturing. However, the central bank also pointed out challenges in other components of foreign investment that impacted the overall picture.
While FDI showed a positive trajectory, the SBP reported a sharp outflow of portfolio investment, with foreign investors pulling out $269 million from Pakistan’s capital markets during 9MFY25. This contrasts significantly with an inflow of $65 million recorded during the same period last year.
Due to this substantial portfolio outflow, the SBP noted that net foreign private investment declined by 8%, standing at $1.38 billion, compared to $1.51 billion in the corresponding months of FY24. Moreover, foreign public investment also took a hit, with an outflow of $73.5 million, reversing an inflow of $100 million seen last year.
As a result, total foreign investment — which includes both private and public flows — dropped by 19%, falling to $1.30 billion in July–March FY25, compared to $1.61 billion in the same period of the previous year.
Despite these setbacks, the 14% rise in FDI is being viewed by analysts as a silver lining. The SBP reiterated the importance of improving macroeconomic stability and implementing investor-friendly reforms to sustain and further accelerate FDI inflows. The central bank acknowledged that while challenges in portfolio and public investments persist, sustained FDI growth could offer a buffer and support economic recovery.
The SBP stressed that enhancing investor confidence through policy consistency, economic reforms, and political stability will be crucial in boosting future FDI and restoring balance across all forms of foreign investment.