Net foreign direct investment flowing into Pakistan — money invested by foreign companies in local businesses, factories, and infrastructure.
Source: SBP EasyData, monthly, net foreign direct investment in Pakistan.
Foreign Direct Investment (FDI) is money foreign companies and investors put directly into Pakistani businesses — building factories, buying significant equity stakes, or expanding operations — as opposed to short-term portfolio investment in stocks and bonds.
Pakistan's FDI has historically been concentrated in a handful of sectors: power generation, oil and gas exploration, telecommunications, and financial services, with China historically among the largest single sources in recent years.
Unlike debt, FDI doesn't have to be repaid with interest, which makes it a comparatively 'cheaper' and more stable way to finance the current account deficit than external borrowing.
FDI inflows bring in foreign currency without creating new debt obligations, helping finance Pakistan's chronic current account deficit and supporting the Rupee.
Pakistan's FDI levels relative to GDP have historically lagged regional peers like Bangladesh and Vietnam, often cited as a symptom of policy inconsistency, security concerns, and a difficult business environment — sustained low FDI limits the technology transfer and job creation foreign investment typically brings.