KARACHI, April 24: Acting President of Federation of Pakistan Chambers of Commerce and Industry Muhammad Farooq Dadabhoy has expressed concern over the drastic decline in foreign investment in Pakistan.

In a statement issued here on Thursday, he attributed the decline in foreign investment to uncertain situation in the country which has perturbed foreign investors as they fear economy may take a further downward course because of the acute power crisis and uncertainty in oil and gas charges.

He said that the country was facing this situation despite the fact that it had extremely liberal policies in place, which allow 100 per cent equity to the foreign investors and 100 per cent repatriation of profits.

Mr Dadabhoy said according to official reports and statistics net foreign investment dropped by 46.3 per cent to $2.985 billion in July-March 2007-08 from $5.558 billion in July-March 2006-07.

Foreign direct investment fell by 21.3 per cent to $3.038 billion from $3.859 billion. There was a net outflow of $53 million portfolio investment from the country during the period under review.

The country had received $1.699bn portfolio investment during the same period last year.

He expressed his anxiety on the decline in inflow of foreign direct investment from the European Union from $1.227 billion to $437.3 million while the FDI from the Netherlands plunged from $497.7 million to $89 million. The FDI from the UK declined from $693.6 million to $279.1 million.

However, the FDI from the United States surged from $635.8 million to $1.139 billion. The inflow of FDI from developing economies declined to $805 million from $1.399 billion.

The acting chief of FPCCI said that even last year quite substantial proportion of foreign direct investment was received in merger and acquisition activity in the services sector. —PPI