By Karim Madad

The foreign direct investment (FDI) in Pakistan totalled $253.4 million during the first quarter (July-September) of the current fiscal year (2022-23) compared to $479.2 million during the same period of last year, showing a decrease of 47.1%.

The power sector received the highest FDI worth $126.5 million (49.9% of the total), according to the Finance Ministry’s outlook report for October 2022. The report said that on a month-on-month (MoM) basis, the FDI was recorded at $83.9 million in September 2022 as against $110.7 million in August 2022. The FDI received from the United Arab Emirates was $59.7 million (23.6% of the total, China $57.2 million (22.6%), Switzerland $34.9 million (13.8%), and the Netherlands $23.2 million (9.2%).

The report showed that financial business attracted $74.4 million (29.4%), and oil and gas explorations $16.0 million (6.3%) during the period under review. It said the foreign private portfolio investment registered a net outflow of $12.1 million during Q1 FY23. Similarly, the foreign public portfolio investment recorded a net outflow of $18.2 million. The total foreign portfolio investment recorded an outflow of $30.3 million during July to September 2022 as against the inflow of $961.6 million last year.

The report further said that the total foreign investment during July-September FY23 reached $223.1 million compared to $1.358 billion achieved last year.

Highlighting the workers remittances, the report said that during Q1 FY23, remittances were recorded at $7.7 billion compared to $8.2 billion last year, showing a decrease by 6.3%. On a MoM basis, remittances decreased by 10.5% in September 2022 ($2.4 billion) compared to August 2022 ($2.7 billion).

The report said Pakistan's total liquid foreign exchange reserves increased to $14.6 billion on October 26, 2022, with the State Bank of Pakistan (SBP) reserves now standing at $8.9 billion. The commercial banks' reserves remained at $5.7 billion.

Regarding the performance of stock exchange, the report said that the KSE-100 Index closed at 41,129 points as on September 30, 2022 while market capitalization managed at Rs6.782 trillion.

The report said that the overall economic outlook shows an optimistic picture of the economic performance in the coming months. It said the CPI inflation is declining, rupee has gained stability, and current account balance is on an improving trend.

The report said the global economy continues to face multiple and steep challenges. The latest IMF (International Monetary Fund) World Economic Outlook (WEO) report reveals that global growth will remain unchanged at 3.2% in 2022. More than a third of the global economy will contract this year as the Ukraine crisis has destabilized it. The report said that gas prices in Europe have increased more than four-fold since 2021.

The rising prospect of energy shortages, increasing costs of living and production are hampering economic activity.

Credit : Independent News Pakistan-WealthPk