Repatriation of profits,dividends jumps to $1.55bn

KARACHI: The outflow of profit and dividends on foreign investments in Pakistan increased 104 per cent to $1.55 billion in the eight months of the current fiscal year, according to the latest data from the State Bank of Pakistan (SBP).

In February, $233.3 million was sent home by multinational corporations and foreign investors who were engaged in the local stock market.Foreign businesses operating in the country have been transferring a significant portion of their repatriated income abroad due to the ongoing improvement in Pakistan’s macroeconomic conditions, particularly in the external account. According to the SBP, there are no restrictions on capital outflows from foreign investors, thanks to stable foreign exchange reserves.

Pakistan’s net foreign direct investment (FDI) increased by 41 per cent, totalling $1.618 billion for the July-February period of FY25. However, the country attracted a net FDI inflow of $94.7 million in February, which represents a 45 per cent decrease, compared with the $172 million inflows recorded during the same month last year.

Data from the SBP showed that profit repatriation from FDI rose to $1.486 billion in the July-February FY25, up from $704.7 million last year. Profits and dividends from foreign private investments during this period amounted to $64.7 million, compared with $55.5 million the year before.

The food sector witnessed the largest outflow of profits and dividends in July-February FY25, totalling $290.6 million, an increase from $97.4 million last year. The power sector placed second, with repatriations of $233.5 million, followed by the financial businesses with $192.6 million in outflows during the eight months of the current fiscal year.