Foreign investors ramp up profit repatriation in Pakistan

In a notable development, foreign investors have significantly increased their profit repatriation, reflecting recent economic improvements in Pakistan, ARY News reported.

According to reports, November 2024 saw a substantial 586 percent increase in profit repatriation compared to November 2023. In November alone, foreign investors sent back $321.6 million in profits, up from $46.9 million in November 2023. This surge indicates growing confidence among foreign investors in the country’s economic stability.

During the first five months of the fiscal year 2025, foreign investors repatriated $1.128 billion in profits, marking a 112 percent annual increase compared to the same period last year.

The improved foreign exchange reserves allowed the State Bank of Pakistan to lift previously imposed restrictions on dollar transfers, facilitating this increased outflow.

Experts suggest that the removal of these restrictions, coupled with the enhanced economic environment, has created a more favorable investment climate, encouraging foreign investors to repatriate profits.

Earlier, Pakistan recorded 31percent surge in Foreign direct investment (FDI) in the first five months of the current fiscal year, ARY News reported on Wednesday, quoting SBP report.

The State Bank of Pakistan (SBP) reported a net FDI inflow of $219 million in November, reflecting a 27pc increase compared to the same period last year.

The data showed a 65pc month-on-month increase, with a surge of $133 million recorded in October of the current fiscal year.

According to the SBP, Chinese companies accounted for 60pc of FDI, with an investment of $469 million from July to November in FY25, followed by Hong Kong, whose investment rose to 44pc, reaching $116 million.

The United Kingdom contributed $113 million in FDI in FY25, an increase from $100 million in the same period of FY24.

In terms of sector-specific investment, the power division, a sector historically facing challenges in Pakistan, noted a 51pc increase in FDI, amounting to $454 million compared to $249 million in the corresponding period of the previous fiscal year.

The financial sector attracted $249 million in FDI this year, up from $247 million the previous year, followed by the gas sector, which received $125 million during the same period, with an increase of 27pc.