KARACHI: The poor health of foreign direct investment (FDI) could not improve in October but a meagre year-on-year growth of seven per cent was noted in the July-October period of FY24.

The State Bank of Pakistan (SBP) on Monday issued the latest data on foreign inflows showing no encouraging signs for the country.

The total foreign inves­tment dipped by over 12pc to $122.5 million in October against $140m in the same month last year. However, the inflows during July-October were $524.7m compared to $489.8m in the same period last year, registering an increase of 7.1pc.

The PMLN-led coalition government had utterly failed to woo foreign investors during its tenure while the caretaker setup has been struggling to improve the situation. However, inflows remained low and limited to a few countries.

Analysts and researchers believe the improvement could be seen after the general elections since the political uncertainty is at its peak.

The elections are scheduled for Feb 8, 2024.

Political activities are picking up momentum which is encouraging but also signalling a message for the investors to stay away till the time a new elected government comes to power.

Inflows from China were the highest at $158m during July-October but remained lower than last year’s $170m in the same period of last year.

The second highest investment of $106.5m came from Hong Kong, doubling last year’s $52m. Other important inflows were $55.8m from the Netherlands, $66.5m from the UK and $43.5m from the US.

Analysts said the unending political and economic uncertainties for the last 20 months have damaged the country’s image abroad making it more difficult for Pakistan to convince foreign investors while domestic investment has also gone down sharply.

Published in Dawn, November 21st, 2023