Pakistan Today

FDI dips by 48.2pc in July-Oct, 2016

 

ARSHAD HUSSAIN

 

The country’s direct investment further declined by 48.2 per cent to $316.1 million only in July-Oct, 2016-17, while its total foreign investment shows a sign of improvement by 48.5 per cent to $1.418 billion, the data released by the State Bank of Pakistan (SBP) stated here on Tuesday.

The direct investment of the country slid down by 48.2 per cent to $316.1 million in the last four months of the current fiscal year compared to $610.5 million received in the same period of 2015-16. The country received direct investment from China, UAE and USA in oil & gas explorations, power and communication industry, and financial business with a total contribution of $180 million in the said period.

The biggest investment $146.1 million has been received from China in power sector and other China-Pakistan Economic Corridor (CPEC) development projects, $63.8 million from United States of America, while $51.9 million from UAE, the SBP said.

According to the analysts, the Pakistan Stock Exchange (PSX) has received the biggest amount of $1.418 billion in local share market through foreign public investors in portfolio investment, while the direct investment of the country had nosedived half of the investments and received only $316.1 million.

Chinese companies are making investment in Pakistan especially in power sector under the CPEC projects. In the last four months, more than $146 million were received through direct investment from China, the analyst claimed. In the period 2015-16, the Chinese companies invested $276.3 million.

In July-Oct, 2015-16, the foreign private investment of the country stood at $277 million, which was received in power sector and other financial services businesses. The country’s total foreign direct investment decreased by 48.2 per cent to $316.1 million in the last four months of the current fiscal year only because of the investment in the power and financial businesses as per the agreement of the government, the analysts claimed. “The foreign countries are not investing their money in Pakistani businesses,” he claimed.

The foreign public investment also increased by 137 per cent to $1.141 million in July-October this year compare to only $481 million received in the same period in 2015-16.

The country has recorded inflows of direct investment of $480 million in July-October, 2016-17, but the outflows were recorded $164 million in the same period, the SBP data said.

The analysts believed that direct investment would improve with the passage of time. The forex reserves of the country touched all time high in September at $24.6 billion. The market had touched 42500 points level in last couple of week. While there is a positive trend in portfolio’s inflows because of MSCI upgradation of Pakistan’s stocks in emerging markets, another analyst claimed.

Exit mobile version