FDI drops 40pc to $168m
Foreign investment in different sectors of Pakistan's economy like power, telecoms, financial business and oil and gas production dropped 40% to $167.6m in March 2021.
Foreign direct investment (FDI) had stood at $278.7 million in the same period of previous fiscal year, the SBP reported. China made the largest net investment of $126 million, mostly in the power sector, in March 2021.
Cumulatively, in the first nine months (Jul-Mar) of current fiscal year 202021, the FDI inflows dropped 35% to $1.39 billion compared to $2.15 billion in the same period of last year.
Talking to The Express Tribune the other day, Overseas Investors Chamber of Commerce and Industry (OICCI) Secretary General
M Abdul Aleem said that the cumulative investment numbers for FY21 were not bad considering the fact that the world, including Pakistan, was passing through shocking times of the Covid-19 pandemic.
The pandemic had put on hold new investment decisions throughout the world, which also caused a drop in fresh foreign investment in Pakistan as well. Secondly, there was a change in the government's strategy as it was now attracting foreign investment in export sectors of the country instead of continuing to invite investment in importbased consumption sectors, it was learnt.
The change in the strategy is aimed at supporting Pakistan's faltering economy. A significant imbalance between the country's higher import payments and lower export earnings has caused a massive surge in its foreign debt over the years, which has significantly impacted the country's foreign currency reserves and weakened its capacity to make international payments.
An official, who was working in close coordination with global investors, said that he had received a number of new investment queries for different sectors including the fast moving consumer goods (FMCG), textile, hospitality and services even during the Covid19 pandemic.
He, however, said that Pakistan needed to better market its potential export sectors to woo global investors. The world is expected to return to normalcy in June-July 2021 as a significant part of its population, mostly in Western countries, will be vaccinated by then, which will allow different nations to fully reopen from lockdowns and ramp up economic activities.