FDI in Pakistan increases by 22.6% to reach $2.0 bn in FY 2016-17
Foreign direct investment (FDI) in Pakistan crossed USD 2.0 billion in July – May period after the month of May contributed $295 million alone. The figures were reported by State Bank of Pakistan (SBP) on Wednesday.
The highest ever FDI Pakistan received was $5.4 billion during fiscal year of 2007-08, according to Board of Investment (BOI). But following years saw continuous decline in FDI amidst the ever growing security concerns and energy crisis. In last fiscal year of 2015-16 FDI hit $1.903 billion.
Key FDI Contributors:
As evident in the last fiscal year of 2015-16, the first 11 month of FY2016-17 saw a major contribution of $879 million from China, around 43% of foreign investment came from China alone.
Next contribution came from Netherland amounted to 465.6 million worth of investment during July – May, the main contribution from such high wave of Dutch investment is the recent acquisition of Engro Foods by Dutch food company.
France with $181 million and Turkey with $135 million came third and fourth major FDI contributor respectively.
Both Food & Power sectors have been contributed heavily throughout the 11 months. It was in May that Power sector overtook Food sector with the inflow of $125 million coming from China in the month of May.
Following are the sector wise FDI contribution:
Inflow in Food Sector stood at $548 million.
Inflow in Power Sector stood at $476 million.
Inflow in Construction Sector stood at $418 million.
Inflow in Electronics Sector stood at $148 million.
Inflow in O&G Sector stood at $135 million.
For developing economies such as Pakistan FDI acts as a reliable economic indicator for progress and growth, this has been observed in our neighboring economies like China and India, who have been receiving foreign investments of 60-65bn annually.