Foreign investors pull $244m profits from Pakistan as business confidence rebounds

ISLAMABAD: Pakistan’s economy has given foreign investors enough reason to start cashing in again. According to fresh numbers from the State Bank of Pakistan (SBP), profit and dividend repatriation by overseas firms jumped 75 percent in July 2025 compared to the same month last year.

Foreign investors sent home $244 million in the first month of the current fiscal year (FY26), up from $139 million in July 2024. The $105 million jump is seen as a sign of healthier corporate earnings and a revival of business sentiment in the country.

A shift in mood among investors

Economists believe this surge reflects more than just balance sheets looking better. They say it’s tied to a slow but steady improvement in macroeconomic conditions, along with a shift in investor confidence.

Recent surveys back this up. The Overseas Investors Chamber of Commerce and Industry (OICCI) found that for the first time in three years, business confidence in Pakistan turned positive. Its Business Confidence Index, based on data collected in March and April, climbed 16 points, moving from a negative five percent last year to plus 11 percent.

Gallup Pakistan also reported a boost in sentiment among private businesses, with optimism reaching its highest point in almost four years. This is despite ongoing struggles with inflation, rising utility prices, and the familiar headache of load-shedding.

Policy changes open the door

Part of the reason for this rebound lies in policy. In FY24, the government had restricted profit repatriation in order to shore up its foreign reserves. Those restrictions were lifted in FY25, allowing companies to freely move earnings abroad.

SBP Governor Jameel Ahmed confirmed last month that by the end of June 2025, the central bank had cleared all pending payments to foreign investors. He also pointed out that reserves crossed the $14 billion mark, offering the country some breathing room.

The breakdown of outflows

The SBP data shows nearly all of July’s outflows came from Foreign Direct Investment (FDI). Profits and dividends from FDI reached $243.8 million, an 82 percent jump from $134 million last year. Outflows from Foreign Portfolio Investment (FPI), on the other hand, dropped sharply to just $0.2 million from $5.3 million a year ago.

For Pakistan, the numbers suggest that while foreign investors are taking their profits home, they are also signalling trust in the economy’s trajectory.

Web Desk