By Staff Reporter
KARACHI: Pakistan attracted $1.64 billion in foreign direct investment during the first nine months of its fiscal year through March, a 14 percent increase from the same period a year earlier, as Chinese inflows doubled and textile and technology exports surged.
Still, a steep monthly drop in March underscores persistent risks from political uncertainty and mounting debt repayments.
Net FDI inflows totalled $2.47 billion from July to March, compared with $828 million in outflows a year earlier, central bank data showed on Thursday.
China accounted for 41 percent of the total, pumping in $684.5 million—a 107 percent annual jump—as it expanded renewable energy projects under the China-Pakistan Economic Corridor. Hong Kong-based investors contributed $175.9 million, up 14 percent. But inflows cratered 91 percent month-on-month in March to $25.7 million, reflecting jitters over delayed IMF loan reviews and election-related instability.
Textile exports, a key jobs pillar, rose 9.4 percent year-on-year to $13.6 billion, driven by knitwear, garments, and bed linen. Technology exports soared 23 percent to $2.82 billion, with March receipts hitting $342 million as firms targeted Gulf markets.
Over 100 Pakistani companies showcased artificial intelligence and cybersecurity solutions at Riyadh’s LEAP 2025 conference, aiming to double tech exports to Saudi Arabia to $50 million annually.
Meanwhile, foreign exchange reserves fell to $10.57 billion as of April 11, down $127 million from the prior week due to debt repayments.
Total liquid reserves dropped to $15.66 billion, though the central bank expects $4 billion to $5 billion in fresh inflows by June—including IMF tranches—to lift reserves above $14 billion. Pakistan faces $26 billion in external debt obligations this fiscal year, with $16 billion likely to be rolled over.
While the FDI rebound and export growth signal tentative economic stabilization, analysts warn that political turbulence and policy reversals could derail progress. The nation’s power sector drew $500 million in FDI, up 46 percent, and financial services attracted $518.4 million, up 12 percent, but rice exports fell 6 percent to $2.75 billion amid weak global demand.
Analysts said the numbers are encouraging, but this isn’t a turnaround. Without lower power tariffs, cheaper credit, and an IMF-backed reform push, these gains could evaporate.
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