KARACHI: Attracting sizeable foreign investment has always been a dream of successive governments. However, the situation has mostly stayed the same as inflows remained unimpressive despite significant growth in percentage terms.

The State Bank of Pakistan (SBP) on Monday reported that the foreign direct investment (FDI) rose 32 per cent to $904 million during July-October FY25 compared to $683m in the same period last year.

The FDI volume is insignificant for experts.

However, the inflows in October plunged almost 20pc year-on-year to $132m, indicating the country’s economic conditions are not good enough to attract foreign investors.

The volume of inflows through FDI remained disappointing for the government, which has been striving to woo investors by offering several incentives.

The situation looks more bleak when it is found that China contributed $414.5m or 46 per cent of the total FDI inflows during the period under review. Other significant inflows were $99.7m from Hong Kong and $94m from the UK.

Trade and industry sources identified the deteriorating law and order situation as the key reason for this disappointing FDI total. They said the almost daily bomb explosions and killings in Balochistan, Khyber Pakhtunkhwa and other parts of the country are the key hurdle discouraging foreign investors.

Published in Dawn, November 19th, 2024