KARACHI: The net foreign direct investment (FDI) to Pakistan surged by 127 per cent to $2.281 billion during the first 10 months of 2019-20, up from $1.006bn in the same period last year.

While the gross FDI displayed an impressive jump of 24.1pc to $2.871bn, the exceptional performance in net inflows came on the back of slowdown in total outflows, which fell to $590 million during 10MFY20, from $1,308m.

According to data published by the State Bank of Pakistan, the biggest source of inflows was the Electricity and Gas Supply sector, accounting for $626.7m in net FDI during 10MFY20, as against $350.1m in the corresponding months of the previous year.

Information and Telecommunication came in second, attracting net inflow of $509m during July-April FY20, compared to an outflow of $115m in the same period of last fiscal year.

These impressive performances of these two sectors made the real difference as they bagged a cumulative $1.136bn, as against combined outflow of $450m the previous year.

Due to pandemic and the resulting lockdowns, IT sector has made gains due to increased usability. The internet data companies are overloaded with higher demand these days compared to pre-coronavirus days.

Mining and quarrying also remained attractive for foreigners, recording net inflows of $389m in 10MFY20, jumping by 78pc over $218m in the same period of last year.

Meanwhile, net FDI to finance and insurance edged lower by 2.24pc to $252.6m during the 10 months, from $258.4m in corresponding period of last fiscal year.

Manufacturing closely followed with net inflow of $234.4m in 10MFY20. However, this represented a massive decline of 56.1pc from $533.6m in the same months of 2018-19.

The sector has been hit hard by the pandemic and the lockdown imposed after that. Large scale manufacturing fell by 5.4 per cent during 9MFY20 while it plunged by 22pc in March compared to February.

Construction, which has lately caught the attention and support of the government, experienced a decline in inflows as net FDI dipped to $117m during 10MFY20, from $187m.

Despite its great potential for growth, performance of the agriculture, forestry and fishing remained lacklustre as the sector attracted only $3.7m in July-April FY20, compared to $10.6m in the ten months of the previous fiscal year.

Published in Dawn, June 3rd, 2020