Chinese FDI soars to $174.7 Million in First Two Months of FY 2024-25

Sep 21, 2024 - 14:04 Updated: Oct 15, 2024 - 22:09
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Chinese FDI soars to $174.7 Million in First Two Months of FY 2024-25

By Tahir Ali

ISLAMABAD: Pakistan’s foreign direct investment (FDI) from China soared to $174.7 million in the first two months of the fiscal year 2024-25, marking a 207.57% year-on-year increase from $56.8 million during the same period last year, according to data from the State Bank of Pakistan (SBP).

In August alone, total FDI from China reached $ 157.6 million while $28 million flowed out, leaving a net inflow of $129.6 million, the SBP reported.

FDI from all partner countries totaled $296.4 million in August, with $82.25 million in outflows, resulting in a net FDI of $214 million. China accounted for 60.6% of August’s net investment, underscoring its dominant role in Pakistan’s foreign investment landscape.

Other key contributors included the United Kingdom ($21.2 million), China’s Hong Kong ($27.7 million), France ($11.3 million), the U.S. ($9.5 million), the UAE ($6 million), Malaysia ($4.1 million), South Korea ($3.2 million), Turkey ($2.4 million), Bahrain ($2.3 million), Lebanon ($2.2 million), Saudi Arabia ($1.6 million), Singapore ($1.3), and Japan ($1.2 million), among others.

For the first two months of FY 2024-25, Pakistan’s total net FDI was $350.3 million, compared to $252 million during the same period in FY 2023-24, reflecting a robust 38.9% increase. Of this, Chinese investment accounted for 49.9% of total FDI.

The power sector attracted the largest share of FDI in August, receiving $148 million in net inflows. This included $119.9 million for hydropower, $24.1 million for coal, and $3.9 million for thermal energy. China’s investment in Pakistan’s power sector, particularly in hydropower, played a crucial role in this influx, as China supports Pakistan’s transition to affordable and environmentally friendly energy sources.

Other sectors benefiting from FDI included electronics ($21.6 million), financial services ($19 million), petroleum ($8.1 million), and oil and gas exploration ($14.4 million). The remaining investments were spread across other sectors.