Islamabad: Foreign Direct Investment (FDI) in Pakistan constricted by 44 per cent during the first seven months of Fiscal Year 2023, Pakistan-based financial daily newspaper Business Recorder reported.

According to Business Recorder, the State Bank of Pakistan (SBP) on Monday reported that the country has got FDI amounting to USD 683 million during July-Jan of FY23 as against USD 1.22 billion in the same period of last fiscal year (FY22). During this period, FDI inflows were USD 1.178 billion and outflows stood at USD 493 million.

However, Year on Year basis, during January 2023, FDI presented improved performance and rose by 101 per cent. With USD 244.3 million inflows and USD 22 million outflows, FDI stood a USD 221.5 million in January 2023 compared to USD 110 million direct investment in January 2022.

The FDI surge in February was led by a significant contraction in investment outflow coupled with a jump in foreign inflow.

During the first seven months of this fiscal year, net foreign portfolio investment also posted negative growth with USD 14 million in outflows, according to State Bank.

Total foreign investment including FDI, portfolio investment and foreign public investment posted a 118 per cent decline during the period under review. Total foreign investment in the country stood at negative USD 341.4 million in July-Jan of FY23 compared to an investment of USD 1.875 billion in the same period of last fiscal year, according to Business Recorder.

The current situation in Pakistan is the most difficult faced by the country in the last two decades, the South Asia Press recently reported, adding that the country, facing an economic crisis, political chaos, and a rising number of terror attacks along the northwestern areas, has been drained of its resources.

Further, according to the report, the country's economic deterioration has a direct impact on the public.

The floods in Pakistan came as a severe blow to the cash-strapped nation already grappling with high debt, the South Asia Press reported, adding that the country's planning commission, agriculture, food, livestock, and fisheries sectors lost USD 3.7 billion in the floods with long-term losses estimated to be around USD 9.24 billion.

In December 2022, inflation in the country stood at 24.5 per cent, almost double of 12.3 per cent from the previous year, the report said, adding that the common people were the most affected by the high flour prices amid the country's worst-ever food crisis.

Many areas in Khyber Pakhtunkhwa, Sindh, and Baluchistan provinces have even witnessed stampedes for grain and flour. Analysts fear the crisis will soon take petroleum products and basic essential items under its fold.

The managing director of the International Monetary Fund (IMF), Kristalina Georgieva said the funding agency has asked Pakistan to take steps to be able to function as a country and not get into a dangerous place where it needs debt restructuring, The News International, a Pakistan daily, reported.

"My heart goes out to the people of Pakistan. They have been devastated by the floods that affected one-third of the population of the country," Georgieva said in an interview with an international broadcaster on Sunday.