Who Is Investing in Pakistan? Foreign Direct Investment in the First Quarter of FY2026-27

Net foreign direct investment reached USD 719.7 million in July to September 2026, up about 20 percent on a year earlier. Canada and China supplied nearly 60 percent of it, while finance, power, trade and mining drew the most.

The headline figure

The State Bank of Pakistan (SBP) reports net direct investment of USD 719.7 million for July to September 2026 (provisional), compared with USD 600.4 million in the same quarter of 2025 (revised). Inflows were USD 967.7 million and outflows USD 248.0 million. For the whole of FY2025-26 the SBP's revised figure for net direct investment is USD 1,790.7 million, down from USD 2,477.3 million in FY2024-25.

Total foreign investment in the quarter was USD 3,651.7 million, but that figure is not a measure of private investor appetite. Of it, USD 2,960.6 million is foreign public investment in debt securities. Foreign private portfolio investment was a net outflow of USD 28.6 million.

Where the money came from

Net direct investment by source country, July to September 2026, with the same quarter a year earlier in brackets (USD million):

• Canada: 229.2 (224.9)
• China: 197.5 (121.3)
• United Kingdom: 83.4 (61.3)
• United Arab Emirates: 54.8 (19.9)
• Switzerland: 44.7 (47.3)
• Hong Kong: 25.6 (33.9)
• Kuwait: 17.9 (8.2)
• Netherlands: 13.9 (27.2)
• United States: 10.2 (20.0)

Canada and China together account for about 59 percent of net direct investment in the quarter. China's inflow was USD 295.5 million, but outflows of USD 98.0 million reduced the net figure. The UAE's net figure almost tripled, and the United Kingdom's rose by about a third. The United States, Hong Kong, the Netherlands and Singapore were lower than a year earlier.

A caution on reading these figures: the SBP reports the immediate source country. Investment routed through a company registered in Canada, for example, appears as Canadian even if the ultimate owner is elsewhere. The figures show where capital arrived from, not necessarily whose capital it is.

Where it went

Net direct investment by sector, July to September 2026 (USD million):

• Financial business: 191.3
• Power: 139.4
• Trade: 115.7
• Mining and quarrying: 102.7
• Transport equipment: 35.0
• Electrical machinery: 20.1
• Information technology: 11.1

Within power, hydel projects accounted for USD 74.8 million and coal for USD 61.2 million; thermal was USD 3.4 million. Trade moved most sharply: from USD 2.4 million a year earlier to USD 115.7 million. The SBP table does not explain the change, and the data alone cannot say whether it reflects a one-off transaction or a trend. Telecommunications recorded a net outflow of USD 2.8 million, and oil and gas exploration a net outflow of USD 8.0 million.

What investors take out

Payments of profit and dividends on foreign direct investment were USD 844.4 million in the quarter, against USD 785.6 million a year earlier. China accounted for USD 315.1 million, the United Kingdom USD 187.0 million and the Netherlands USD 113.5 million. These payments and net new investment are different measures and should not be netted against each other, but together they show that foreign investors do repatriate earnings, and that the countries receiving most are also those with the largest existing stakes. At the end of 2024 the United Kingdom held the largest stock of inward direct investment (USD 6,531.4 million), followed by China (USD 4,641.5 million) and the UAE (USD 4,367.8 million).

What to watch

These are provisional figures for a single quarter, and the SBP routinely revises them. The mix matters more than the total: investment concentrated in a few sources and in sectors such as power and finance leaves the overall figure sensitive to individual projects. Whether trade and mining sustain their pace through the year, and whether the UAE and UK increases persist, will show in the next releases.

Sources

• State Bank of Pakistan, Foreign Investment in Pakistan by Country, by Sector and Summary, September 2026 release (provisional)
• State Bank of Pakistan, Repatriation of Profit / Dividend by Country on Foreign Investment, September 2026
• State Bank of Pakistan, Pakistan Core Set of Inward Direct Investment Positions for End 2024 (IMF Coordinated Direct Investment Survey)