According to the State Bank of Pakistan (SBP), Pakistan has made a significant improvement in attracting foreign direct investment (FDI) during the first half of the current fiscal year (FY). The FDI inflows in the first half of the current FY jumps 68.3 per cent in comparison to the figures in the same period last year. The increase in FDI means that the government is succeeding in making Pakistan an attractive place of investment for foreign businesses. Pakistan Tehreek-e-Insaf (PTI) rightly deserves appreciation for this. The government’s focused efforts, to bring about reforms and positive impacts in the ease of doing business area, are bearing fruits in the form of an increase in FDI. Hopefully, the government policies will see further improvements, and, as a result, more FDI inflows will come to the national kitty in the future.
That much said it is, however, essential for the government to make more and more sectors attractive for foreign investments. Since, the significant chunk of this year investments was concentrated in two major sectors, i.e., telecommunication and power and electrical machinery sectors. Many untouched sectors can be attractive areas for FDI, chemicals, pharmaceutical and fertilizer; oil and gas; and banking and finance, to name a few.
It is correct that significant improvements in the country’s overall macroeconomic environment and sound policies have helped attract relatively large inflows of FDI in Pakistan in the first half of the current FY. However, the government has to travel a long distance, especially in going up further on ease of doing business index. Perhaps, this government is well aware of the fact that a conducive investment climate is a must for attracting foreign investment by providing a more facilitative institutional, policy and regulatory environment for businesses to operate. Expectantly, the increase in FDI will boost the government’s morale, and it will enhance its efforts to attract more foreign capital inflows in the country.