KARACHI: Foreign investment in Pakistan’s domestic bonds reached $188 million in the first nine days of October, indicating growing overseas interest and opening another source of dollar inflows for the government.
Latest State Bank of Pakistan data showed that investors from Gulf countries were taking a particular interest in domestic bonds, especially longer-term Pakistan Investment Bonds (PIBs).
During the first nine days of October, treasury bills attracted $78m, while PIBs received $110m. Pakistan has long sought greater foreign investment in government securities, but most previous inflows were limited to short-term instruments and remained relatively modest.
The emerging trend could provide another source of foreign exchange for the country, which received record remittances of $41.5bn in FY26. However, export growth has remained weak, contributing to a widening trade deficit and making it harder to sustain a current account surplus.
Foreign investment outflows during the nine-day period stood at $38.16m, significantly lower than the $188m inflow.
A breakdown of the data showed that the largest investment came from the United Arab Emirates, which invested $50m in T-bills and $80m in PIBs during the period.
Bahrain invested $30m in PIBs and $10m in T-bills during the first nine days of October.
Since the beginning of the current fiscal year, total foreign investment in domestic government securities has reached $656m, including $404m in PIBs and $252m in T-bills.
Financial experts offered different views over the rising inflows, particularly from Gulf countries.
Some believe Pakistanis living and doing business in the Gulf may be shifting part of their liquid assets to Pakistan by investing in high-yield and risk-free government securities.
Others said returns on T-bills and PIBs had become increasingly attractive amid regional economic uncertainty caused by the continuing war.
Published in Dawn, October 18th, 2026
