KARACHI, April 22: Pakistan attracted $287.4 million foreign direct investment in the first nine months of this fiscal year of which $164.1 million came from the US.

“This means Pakistan can easily achieve the revised target of $355 million for the entire fiscal year,” said a senior official of the ministry of finance when reached by Dawn over telephone.

The inflow of $287.4 million contractual FDI between July 2001 and March 2002 comes as a big source of relief for the country that attracted only $322 million in the entire fiscal (July/June 2001/02).

Government officials hope that the country may end up getting more than $400 million FDI in the current fiscal year. If that happens then the economic managers will find it easier to manage the balance of payments position because the projections for BOP envisages only $355 million FDI. That the BOP position is anyway going to be much better than projected is being taken for granted by some optimist officials of the ministry of finance. They quote for example the projection of $1.722 billion workers remittances for the current fiscal year. They say that the actual inflow of workers remittances should be much higher in the current fiscal year as the country has already attracted $1.543 billion in the first nine months (July/March 2001/02).

The latest State Bank figures show that out of $287.4 million FDI attracted during the first nine months of this fiscal year $164.1 million came from the US alone. In a year-ago period the FDI from US totalled only $55.5 million.

Officials of Pakistan American Business Council term it as a clear sign of increased confidence of the US investors in Pakistan economy. But whereas the government believes that the inflow of FDI will continue to maintain its pace in April-June this year observers say much would depend on how the investors perceive the political developments taking place in Pakistan.

“It all depends on whether the investors confidence remain the same even in the changing scenario,” said chief executive of a foreign bank who declined to be named.

Executives of foreign companies operating here say the country also needs to ease further the bureaucratic hassles and offer trouble shooting facility to ensure that the long-term contracted investment really starts coming in.

Industry wise official breakdown of the $287.4 million FDI is not available but senior bankers and industrialists say that oil and gas sector has attracted the major chunk of it. The FDI also includes long-term foreign investment contracted by Pakistanis settled abroad. Bankers say energy and telecommunication sectors have also attracted part of FDI.

Pakistan is well positioned to attract more US foreign direct investment after the revival of insurance cover for the US investors as well as lifting of the ban on the operations of the US export-import bank.

Analysts say the country may attract increased FDI from the US and other countries also on the basis of the reforms that it has brought about in various sectors of the economy.

Whereas the foreign direct investment from the US rose sharply, FDI from the UK fell to $22.6 million in the first nine months of this fiscal year from about $77.5 million in a year-ago period.

Foreign direct investment from Saudi Arabia and Germany also declined to $2.1 million and $8.6 million from $40.2 million and $11.8 million respectively. But FDI from the United Arab Emirates and Switzerland rose from $3.7 million and $2.6 million respectively in July-March 2001 to $15.9 million and $6.5 million in July-March 2002. Foreign direct investment from France also rose from $700,000 to $1.5 million.

FDI from Canada shot up to $3 million in July-March 2001-02 from only $100,000 in July-March 2000-01. But FDI from Hong Kong and Japan slipped to $2.2 million and $4.1 million from $2.7 million and $8 million respectively.