Foreign direct investment declined in the first two months of current fiscal year.

The State Bank of Pakistan (SBP) released the FDI figures for Jul-Aug’2021 on Friday which shows that Pakistan attracted $ 203 million in foreign direct investment between July-August’2021 period, down from $ 255 million in the first two months of last fiscal year, marking a decline of $52 million. During the period, Gross direct investment inflows stood at $ 359.5 million, while Gross Investment Outflows stood at $156.4 million.

During the year, China became top country of providing foreign direct investment. Chinese investors invested about $ 54 million in Pakistan in the first two months of this fiscal year. Singapore and Hong Kong with $ 25 million and $ 20 million are also important foreign direct investors (FDI).

Detailed analysis showed that, despite the improvements in Stock Market, foreign investors continue to withdraw their investments from the stock market. The second component of foreign investment, portfolio investment, resulted an outflow of $ 15 million during the first two months of this fiscal year.

However, total foreign investment in Pakistan has increased significantly as a result of the sale of debt securities on the international market. Pakistan received $ 976 million in foreign Debt Sales during July-August of this fiscal year, compared with $ 25.5 million raised in the same period last fiscal year.

As a result, Pakistan’s total foreign investment, which includes foreign direct investment, investment in Debt and Stock market , increased sharply by 877% over the period under review. Pakistan’s total foreign investment rose to $ 1.165 billion in July-August 021, up from about $ 119.2 million in the same period 2020, which is $ 1.046 billion more this year.

On monthly basis, Net FDI stood at $113.2 million in August 2021 compared to $126 million in August 2020

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