Foreign Direct Investment in Pakistan Down by 22% in First Two Months of FY26

Pakistan’s net foreign direct investment (FDI) fell 22% year-on-year to $364.3 million during the first two months of the current fiscal year (July–August FY26), according to data released by the State Bank of Pakistan (SBP) on Thursday. Gross inflows dropped 16% to $560 million, while outflows slipped 2% to $196 million. On a monthly basis, FDI fell sharply by 43% in August 2025, totaling $156 million compared to $272.4 million in August 2024. July, however, recorded a 7% year-on-year increase, with inflows rising to $208 million. China remained the largest investor with $120 million in July-August FY26, though this was less than half of the $254 million received in the same period last year. Hong Kong followed with $60 million, also down from $86 million a year earlier. Meanwhile, foreign portfolio investment saw net outflows of $75 million during the two-month period, compared to inflows of $25 million in July-August FY25. As a result, total net foreign investment, comprising FDI, portfolio investment, and foreign public investment, fell 51% year-on-year to $278 million, down from $570 million in the corresponding period of last fiscal year.