Professor Naila
Pakistan’s foreign investment numbers have picked up some momentum, and China is leading the charge. In just the first two months of the fiscal year, Pakistan pulled in about $364.3 million in foreign direct investment (FDI), and a big chunk of that $120 million came from China. That’s roughly a third of the total, making China the single largest investor during this period.
In August alone, Chinese inflows hit $68.6 million, almost half of what Pakistan received that month. It’s another sign that the economic relationship between the two countries is tightening, moving beyond symbolic projects and turning into sustained, high-value investments.
Why China’s Money Matters Right Now
For years, Pakistan’s economy has been walking a fine line. Foreign reserves are fragile, power shortages keep biting, and local industries often struggle to scale. Having China step in with consistent FDI isn’t just about big numbers on a spreadsheet. It keeps the lights on literally, in many cases and signals to other investors that Pakistan’s economy is still worth betting on.
Most of this money is still flowing into the power sector, which pulled in $156.9 million in the first two months. That’s not surprising given Pakistan’s chronic electricity issues. Chinese-backed hydro, solar, and coal projects under the broader China-Pakistan Economic Corridor (CPEC) continue to fill gaps, and newer renewable projects suggest Beijing’s looking long-term.
It’s Not Just About Energy
What’s interesting is that Chinese interest is spreading out. Beyond power, they’ve been putting money into financial services, electrical machinery, and electronics. For Pakistan, that’s a big deal. Energy projects keep things running, but investment in banks, fintech, and manufacturing can drive real economic diversification.
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