Soaring FDI in Pakistan.

 
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Byline: S. Kamal Hayder Kazmi

Researchers say that the economic performance and economic growth of a country is influenced through multiple factors. For economies in general and developing economies in particular, Foreign Direct Investment (FDI) has been believed and argued as a significant determinant, basically made to acquire lasting interest in an enterprise operating in an economy other than that of the investor, for the purpose being an effective voice in the management or control of that enterprise.

Net FDI in Pakistan ($ Million)

Country###2013-14 2014-15 2015-16 2016-17 2017-18 FY19 (R) FY20 (P)

Oil and Gas###502###300.5###248.9###146###372###323.3###61.9

Financial Business###192.8###256.4###289###296.1###400.3###286.5###131.1

Textiles###-0.2###43.9###20###15.5###49.7###76.8###22.8

Trade###-3.2###50.5###26.8###32.7###143###76.3###19.1

Construction###28.8###53.5###46.7###465.9###708.9###335###7.5

Power###71.4###282.2###1159.2###700###1,203.00 -253.6###53.7

Chemicals###94.9###60.3###88.5###5.4###48.9###134.5###12.1

Transport###2.7###6.2###70.2###57.6###56.9###37.1###6.2

Communication

(IT and Telecom)###434.2###40.1###246.8###-41.9###113###-55.7###291.6

Others###375.2###-105.7###109.2###1,069.30 375.5###707.8###244.1

Total###1,698.60 987.9###2,305.30 2,746.80 3,471.20 1,668.00 850.1

According to the data released by State Bank of Pakistan (SBP), in Pakistan presently FDI surged to US $850 million in July-November (2019-20) as against to the investment of $477.3 million registered during corresponding period, a year ago, explaining a growth of 78.1 percent. On year-on-year basis, however, the FDI declined to $200.1 million in November 2019 against $285.4 million registered during the same month of previous year. In total, the foreign investment in Pakistan surged by 1,267 percent to $2.006 billion in July-November this year as against to the investment of $146.7 million during corresponding period of previous year.

The economists urged that economies all over the world, in their pursuit for economic growth depend on both domestic and foreign investments. The above assertion is derived from the fact that different scholars have organized the positive link between investment and economic growth. Economic growth is a continuous rise in any country's productive capacity measured as the percentage raise in Real GDP; whereas, investment is the placement of capital in anticipation of deriving income or profit from its use.

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