ISLAMABAD, July 18: Pakistan attracted the highest ever $1.5 billion Foreign Direct Investment (FDI) in 2004-05 compared to $949.4 million of 2003-04. Board of Investment Chairman Waseem Haqqie told Dawn on Monday that there has also been $152.6 million portfolio investment received during the year under review and as such the figure of total foreign investment stood at $1.676 billion. The FDI target for 2005-06, he said, will be $3.3 billion to be achieved by extending all possible facilities and concessions to the foreign investors especially those of the housing and construction sectors.

There has been 60.5 per cent increase in FDI in last 12 months (July-June 2005) over the corresponding period of last year.

However, the FDI amounting to $1.5 billion (exactly $1,523.9 million) also included $363 million privatization proceeds received on account of off-loading of 10 per cent shares of Pakistan Telecommunication Company Limited ($260 million) and Habib Bank Limited ($103 million second tranche).

Earlier, in 1995-1996, Pakistan had attracted the highest ever FDI worth $1.101 billion. During 2001-02 and 2000-01, Pakistan got FDI worth $798 million and $484.7 million respectively.

Month-wise break up showed that FDI amounting to $52.2 million, $56.6 million, $72.3 million, $94.2 million, $52.4 million, $117.3 million, $70 million, $82.6 million, $195 million, $98.9 million, $138.2 million and $494.3 million were received in July, August, September, October, November, December, January, February, March, April, May and June respectively.

The communications remained the highest sector which attracted FDI worth $517 million (34 per cent) followed by financial business $269.4 million (17.7 per cent), oil, gas and petrochemical $217 million (14.3 per cent), power $73.3 million (4.8 per cent), trade $52.1 million (3.4 percent), chemicals $51 million (3.3 per cent) and others $343.1 million (22.5 per cent).

United Arab Emirates (UAE) remained on top to provide $367.5 million FDI followed by the United States ($326 million), United Kingdom ($181.5 million), Switzerland ($137.5 million), Japan ($45.2 million), Netherlands ($36.7 million) and others $429.7 million.

Responding to a question, the BoI chairman said that although communications, oil & gas, power and financial business were expected to receive increased FDI, housing and construction activities will also bring substantial foreign investment during the current financial year.

He said that Pakistan Power and Infrastructure Board (PPIB) was ensuring $7 billion foreign investment in next five years in the power sector which will generate new 8,000-mw of electricity.

Mr Haqqie said that UAE’s Prince Walid, Price Ghurarir, Abdul Latif Jamil (ALJ) Group, Emmar Group, Meinhardt of Singapore and couple of Malaysian companies have shown interest to make investment in the housing and construction business.

“This includes the construction of three 5-star hotels, each in Karachi, Lahore and Islamabad”, he said. In addition, he said one BNP group will invest Rs4.88 billion to construct a hotel next to Convention Centre, Islamabad for which 135 acres had been purchased. Then, he said there will be an extension of Serene Hotel and the construction of inter-continental hotel in Islamabad.

He said the provision of a Shopping Mall, Recreational Facility and an extension of Blue Area from F-8 to G-8 Sector was also included in the construction programme for Islamabad.

Similarly, the BoI chairman said that Abu Dhabi group and Al-Nihan Group would be making $1 billion investment, $500 million each in Lahore. Also, another Bokhatar group of UAE has plans to make an investment which will be a joint venture with Punjab government in the housing sector.

“Then there will be new foreign investment in Defence Housing Society (DHA), Karachi to have Shopping Malls, Office Towers and Hotels”, he said adding that new foreign investment will also be coming in Creek City housing project, Raffle Club, Golf Club and Club House in Karachi.

He said that a decision has been made to build an industrial estate on 1,500 acres of Pakistan Steel. Moreover, there will an industrial park to be constructed on 2,000 acres of Port Qasim, he said adding that a textile city will also be built in Karachi for which foreign investment was being lined up.

“There will be a number of public-private partnerships in 2005-06 to facilitate substantial foreign investment”, the chairman BoI said.