Foreign companies send nearly $752m abroad as profit repatriation soars

WEB DESK: Foreign investors pulled a significantly higher amount of profits and dividends from Pakistan in the first quarter of the current fiscal year, marking a strong 85.83 percent increase compared to the same period last year, according to data released by the State Bank of Pakistan (SBP).

Profit outflows surge amid foreign confidence

During the first three months of FY26 (July to September), foreign companies repatriated a total of $751.7 million in profits and dividends, up from $404.5 million in the corresponding period last year. Of this, $734.6 million was linked to foreign direct investments (FDI), reflecting a sharp 92.5 percent rise from $381.6 million in the same period of FY25.

In contrast, outflows related to portfolio investments fell by 25.6 percent year-on-year, dropping to $17.1 million compared to $23 million in the same period of the previous year.

The data also showed that in September alone, profit repatriation by foreign firms stood at $159 million, signalling a consistent flow of returns to overseas investors.

Power and financial sectors lead repatriation

A sector-wise breakdown revealed that the Power sector topped the list, sending $186 million abroad during the quarter. The Financial Business sector followed closely with $183.9 million, while the Communications sector saw outflows rise to $68.3 million.

Profit payments from the Food and Tobacco & Cigarettes sectors were reported at $61.6 million and $42.3 million respectively. These figures suggest that key utility, finance, and consumer industries remain major profit generators for foreign investors in Pakistan.

China tops the list of profit recipients

Country-wise data showed that investors from China were the top recipients, repatriating $205.6 million during the quarter, a sharp rise from $34.3 million in the same period last year. In September alone, payments to Chinese firms stood at $65.7 million.

The United Kingdom followed with $162.2 million, up from $145.5 million last year, while the Netherlands came third with a significant jump to $92.3 million from just $6.7 million in the same period a year earlier. The United States ranked fourth, with firms sending $68.6 million in profits back home during the quarter.

A reflection of improved foreign business activity

The surge in repatriation suggests that foreign firms are once again seeing improved profit flows from their operations in Pakistan, reflecting both higher earnings and an easing of restrictions on dollar transfers.

Analysts say that while the rise signals better profitability among foreign enterprises, it also indicates a higher outflow of foreign exchange at a time when Pakistan continues to navigate external financing pressures.