KARACHI, July 24: Pakistan paid over $1 billion as interest and dividend (repatriation) on foreign investment which was 30 per cent higher than the investment received during the fiscal year ended on June 30.
The State Bank reported on Tuesday that the outflows stood at $1.061 billion while it received just $741 million during 2011-12, reflecting a critical imbalance on the external front.
The external account is already under massive pressure of trade imbalance which finally cultivated a current account deficit for the country amounting to $4.517 billion.
Though the country emerged as one of the few countries in the world receiving over $12 billion as remittances, shrinking foreign inflows have badly damaged its image as well as forex reserves.
According to SBP, repatriation on Foreign Direct Investment (FDI) during the year rose to $780 million while it received just $812 million FDI, indicating that most of the amount left the economy.
During the last four years, FDI fell sharply and remained below 20 per cent of the FDI it received in FY08. In FY08, Pakistan received $5.41 billion and it ended as $812 million in FY-12.
The details of FDI showed that most of investments were focused mainly on oil and gas exploration while other sectors either witnessed withdrawal or received insignificant amount of investment.
The outflows from power sector foreign investment during the year were $97 million while the sector also witnessed a net withdrawal of $85 million.
Oil and Gas sector received net $612 million FDI and the outflows were just $0.4 million. Last year the repatriated amount from the sector was $45 million.
The financial business received $56.4 million FDI while the repatriated amount on investments was $133 million.
Similarly, the transport sector received inflows of $10.9 million while outflows were $111 million.Outflows from the food sector were to the tune of $69.5 million and petroleum refining $85.7 million while inflows were to the tune of $13.6 million and $14.6 million.
Telecommunications witnessed a net withdrawal of $361 million while outflows on investment were to the tune of $50 million.
Dwindling foreign exchange reserves and inflows have badly hit the exchange rate which devalued the local currency by 8.8 per cent against the US dollar in FY-2012.