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KARACHI: Net foreign investment in Pakistan fell 0.3 per cent to $1.318 billion in the first nine months of the 2010/11 fiscal year, due to a decrease in foreign direct investment, the central bank said on Thursday.
Foreign investment totalled $1.321 billion in the same period last year.
Foreign direct investment fell 28 per cent in the July-March period to $1.08 billion from $1.50 billion in the same period last year, the State Bank of Pakistan said.
Pakistan's unstable security situation, a Taliban insurgency in the country's northwest and chronic power shortages have put off long-term investors, some analysts say.
However, with emerging markets increasingly on the radar of fund managers, Pakistan has seen a flow of foreign investment in the country's main stock exchange.
Foreign portfolio investment rose 229 per cent to $235.5 million in the first nine months of 2010/11, compared with an outflow of $182.6 million in the same period last year.
Pakistan has struggled with a troubled economy. An International Monetary Fund (IMF) emergency loan package agreed to in November 2008 helped Pakistan avert a balance of payments crisis and shore up reserves.
It received the fifth tranche of $1.13 billion of the $11 billion loan in May 2010. Pakistan and IMF authorities are scheduled to meet before June 30 to discuss the release of the sixth tranche.
