Pakistan’s economic outlook is bolstered by a steady rise in foreign direct investment (FDI). According to the State Bank of Pakistan, FDI for the first eleven months of fiscal year 2024 (FY24) reached $1.73 billion, exceeding the $1.5 billion recorded during the same period last year. This positive trend indicates growing investor confidence in the Pakistani market.
May 2024 saw a particularly strong performance, with FDI reaching $270.9 million, a significant increase compared to $155.7 million in May 2023. This 66.47% year-on-year growth highlights a surge in investor interest. This is no surprise given the many positive developments. The stock market has been setting and breaking historical records, imports and local production have been booming, and there is a national development plan worth trillions underway.
Furthermore, a breakdown of the figures reveals encouraging details. Direct investment inflows, a key indicator of long-term commitment, rose sharply to $339.1 million in May 2024, a clear sign of foreign companies establishing a foothold in Pakistan. Additionally, portfolio investment through equity securities witnessed a positive shift, with an inflow of $34.9 million in May 2024, compared to an outflow in the previous year.
This positive trend extends beyond May. Total foreign investment for the first eleven months of FY24 reached $1.17 billion, a substantial increase from $482 million in the corresponding period last year. This nearly 143% growth demonstrates a significant rise in foreign capital entering Pakistan.
Pakistan’s economic stability, coupled with its strategic location and growing consumer base, is attracting international investors. The government’s ongoing efforts to improve the business environment are further contributing to this positive shift. As FDI continues to rise, Pakistan is well-positioned for continued economic development and job creation.
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