FDI grows in Pakistan but cement and construction sectors lag behind

Pakistan received a net total foreign direct investment (FDI) of US$1.563bn during first seven months of FY19-20 (July 2019 – January 2020) compared to US$943.6m in the comparative period of a year earlier. This represents an increase of 65.70 per cent YoY, mainly due to a high inflow of investment from China, Norway, Japan, Malta, South Korea and other countries in all sectors, according to the State Bank of Pakistan.

However, the increasing FDI trend has not been evidenced in the country’s construction and cement industries, which still lag behind other industries.

Pakistan’s cement and construction sectors recorded a drop in net FDI of 89.78 per cent to US$32.4m in the 7MFY19-20, compared to US$317.2m in the corresponding period of last year. Of this total, the cement industry attracted an investment of US$22.6m and the construction sector US$9.8m, compared to US$28.3m and US$288.9m in year-ago period. This represents a decline of 20 and 96.5 per cent in the cement and construction sectors, respectively. In December 2019 alone both sectors attract a total FDI of US$20.1m.