The net foreign investment inflows have witnessed massive growth, surging to $3.98 billion during the eight months of the financial year 2019-20, according to the State Bank of Pakistan.
Foreign direct investment (FDI) is at its peak in the PTI-led government, which is also the highest rise since 2017. Last year, the inflows stood at a mere $650 million during the same period.
The FDI in the real sector increased to $1.85 billion in July to February in this financial year as compared to $1.05 billion recorded in the same period of the last financial year.
Investments from China have increased to over $696 million as part of the CPEC’s second phase in various sectors. It was followed by Norway with $288 million, Malta with $148 million and Hong Kong with $133 million respectively.
On the other hand, foreign portfolio investment also showed persistent growth from July 2019 to January 2020 but in February it saw a steep outflow of over $1 billion on the repatriation of investment by foreign funds managers in government debt and securities and withdrawal of investment from equity markets.
Later in March, the situation of foreign portfolio investment witnessed the worst situation with a colossal amount of divestment made by foreign investment.
According to SBP, the debt securities including T-Bills and Pakistan Investment Bonds received an investment of $2.1 billion in the said period. Investment inflows were prominent from fund managers in the UK and the USA.
Investment inflows in real sectors and debt securities are likely to continue this year mainly due to the continuation of CPEC projects and lucrative profit rates on government securities. However, the outbreak of coronavirus pandemic has changed the entire scenario of the global economy and its dynamics, which affected the trade of equity market globally and locally and investment sentiments all over the world.
Source: Pro Pakistani