ISLAMABAD: China emerged as the largest investor in Pakistan in December 2025, recording net direct investment of $114.1 million, according to data released by the State Bank of Pakistan. The Netherlands followed with $22 million, while Hong Kong invested $20.5 million during the month. These inflows placed China firmly at the top among foreign contributors, even as overall investment trends showed continued pressure.
During the first half of FY2026, China also retained its position as the leading investor, with cumulative net foreign direct investment of $422.9 million. Hong Kong ranked second with $163.8 million, while the United Arab Emirates contributed $112.2 million over the same period. Collectively, these three economies accounted for a substantial portion of Pakistan’s external capital inflows.
However, total FDI during 6MFY26 stood at $808.1 million, reflecting a steep year-on-year decline of 43.28% compared with $1.42 billion recorded in the corresponding period last year. China accounted for 52.33% of total FDI during the period, yet investment from Beijing still dropped by 41.56% compared with $723.7 million in 6MFY25. Hong Kong’s share stood at 20.27%, but its inflows declined 34.72% year-on-year. Similarly, the UAE’s contribution fell 30.7% compared with last year.
Portfolio flows remain volatile as overall foreign investment weakens
Other notable investors during 6MFY26 included Switzerland with $106.8 million, the United Kingdom with $55.6 million, and a collective “Others” category with $77.9 million. Meanwhile, Foreign Portfolio Investment posted a positive inflow of $13.1 million in December, although cumulative FPI still showed a divestment of $600.6 million during 6MFY26, significantly higher than the $81.8 million divestment recorded a year earlier.
Overall, total foreign investment in December stood at negative $121.6 million. On a cumulative basis, Pakistan attracted $207.4 million in total foreign investment during 6MFY26, sharply lower than the $1.34 billion recorded in the same period last year, underlining ongoing investor caution.
