KARACHI: Foreign direct investment (FDI) shrank 23.27 per cent month-on-month to $87.7 million in July amid prevailing unfavourable political and economic conditions.

However, data released by the State Bank of Pakistan (SBP) on Friday showed that the FDI increased by $12.9m or 17.3pc when compared with an inflow of $74.8m the country received in July 2022.

The central bank data showed that the foreign portfolio inflows were significantly higher than the previous year. The portfolio investment in July was $16.3m which collectively increased the total inflows to $104m.

The FDI in July 2022 was $74.8m and after adding a $3.7m portfolio investment the total rose to $78.5m.

Year-on-year, FDI inflows show a rise of 17pc

The highest FDI inflows were from China totalling $18m in July much higher than $7.1m in the same month last year. China has been the largest investor in Pakistan for last many years.

The inflows from Hong Kong were $16.9m, Netherlands $12.1m, Switzerland $10.1m and UAE $8.3m. The highest foreign portfolio investment came from the US totalling $7.9m in July.

The interim government has taken charge but it needs time to bring economic and political stability.

Published in Dawn, August 19th, 2023