KARACHI: Despite rising uncertainty and a volatile external environment, Pakistan succeeded in sending out higher profits on foreign investments than last year.

Data for the first nine months issued by the State Bank of Pakistan (SBP) on Monday shows that the outflow of profits and dividends increased to $1.828 billion during July-March FY26, compared to $1.718bn in the same period last year; an increase of $110 million.

Pakistan has been facing a tough time due to the Gulf war, as rising imported oil and gas prices have fueled inflation. Export markets in the Middle East have been temporarily disrupted, and production costs have increased due to higher diesel and petroleum prices.

At the same time, Pakistan had to pay $1.4bn in Eurobond maturities and $3.5bn to the UAE in April. Under these circumstances, and with the war still looming in the region, the SBP continued allowing outflows.

The country is trying to manage its external account with the help of Saudi Arabia (from which $2bn has already reached the SBP) and by raising $750 million through Eurobonds on Monday.

What remains concerning is the decline in foreign direct investment, as only a few countries are showing interest in investing in Pakistan. FDI fell by 27 per cent during the first nine months of FY26.

The sectors that remained attractive and paid high dividends were the financial sector (banks) and the power sector. The outflow of profits from the power sector was the highest, at $427.5 million during the nine months, compared to $328m last year. The financial sector has a strong grip in Pakistan, but it earns mainly by lending to the government, and the size of lending has reached a record high. Profit outflows for this sector during this period were $405m, compared to the previous year’s $214m.

Food, telecom, oil and gas

Other sectors generating significant profits included food, with $142m ($291m last year); telecommunications, $112m ($108m last year); and the oil and gas sector, $50.5m ($109m last year).

Country-wise data shows that the largest recipient of profits on foreign investments was the UK, which received a total of $475m during the nine-month period, compared to $511m in the last fiscal year.

China’s profits from investments in Pakistan nearly doubled compared to the same nine-month period last year. Profit outflows to China reached $438.7 million, up from $221m.

Profits for the United States and the UAE declined compared to last year. The US received a profit of $163m ($190.7m last year), the UAE $128m ($146m), and the Netherlands $158m ($163m).

The data indicate that most profits and dividends were generated from previous foreign investments, as new FDI has declined significantly over the past several years. Experts believe there is little chance of higher FDI inflows, as the war situation in the region remains unclear.

Despite the war in March, the outflow of profits was significant, reaching $102.4m, seen as encouragement for investors.

Published in Dawn, April 21st, 2026