Foreign investment in Pakistan rises 5pc in FY25, driven by Chinese inflows

ISLAMABAD: Foreign direct investment (FDI) into Pakistan grew by 5 per cent in the fiscal year 2024–25, mainly due to a sharp rise in Chinese investment, according to new data released by the State Bank of Pakistan (SBP).

Pakistan received FDI worth $2.457 billion between July and June of FY25, compared to $2.347 billion during the same period of the previous year. This reflects an increase of $110 million over the year.

The overall inflows stood at $4.026 billion, up 27 per cent from the previous year, while outflows also jumped by 92 per cent to $1.569 billion.

Analysts believe the rise in FDI signals growing investor confidence in the economy. They point to a surplus in the current account and improved economic indicators, which have helped lift foreign exchange reserves to the $20 billion mark.

China emerged as the largest contributor to FDI, accounting for nearly half of the total investment. Chinese inflows jumped by 91 per cent to $1.227 billion in FY25, up from $643 million a year earlier.

Hong Kong followed with $470 million in investment, more than double the $212 million it brought in during FY24. The United Arab Emirates (UAE) ranked third, investing $283 million, marking a 114 per cent rise from the previous year.

On a monthly basis, FDI rose slightly in June to $206.6 million, compared to $205 million in the same month last year.

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