KARACHI: Foreign direct investment (FDI) plunged by 39 per cent month-on-month to $135.6 million in November. However, the inflows grew by 12pc year-on-year to $798m in the first five months of the current fiscal year.

The provisional data released by the State Bank of Pakistan on Friday showed that the total foreign investment swelled by 73pc year-on-year to $455m in the July-November period.The highest FDI inflows came from the Netherlands at $153m in 5MFY22 as compared to $35m in the same period last year. While inflows from China dipped to $149m in 5MFY22 against $337m in July-November 2020-21.

However, the inflows from the US rose to $130m as compared to $39.5m in 5MFY21.

The FDI from the United Arab Emirates and the United Kingdom improved to $66.8m and $66m as compared to $32m and $50.5m, respectively, in the same period last year. Inflows from Hong Kong stood at $66.3m as compared to $54m in 5MFY21.

Sector-wise breakup showed that the power sector recorded a sharp decline of 48pc to $229m in 5MFY22 from $441m in 5MFY21. However, the financial businesses attracted 36pc more inflows to $155.7m in the July-November period against $114m it received in 5MFY21.

Analysts said that investment in the power sector had almost completed and this is one of the reasons for the declining FDI in this sector.

Inflows in the communication sector surged to $100m in 5MFY22 from a net outflow of $48.6m in the corresponding period last year. The food sector had a little higher inflows at $11m in the July-November period as compared to $7.1m in the same period last year. The FDI in textiles also rose to $6.9m in 5MFY22 against a meagre sum of $1.1m in the same period last year.They said the communication and telecom sector had been showing improvement after witnessing a net outflow in the same period last year.

Published in Dawn, December 18th, 2021