Foreign investors repatriated $1.42 billion in profits and dividends from Pakistan during the first five months of fiscal year 2026 (5MFY26), marking a 24.46% increase compared to $1.14 billion repatriated in the same period last year, according to the latest data released by the State Bank of Pakistan (SBP).
The increase was primarily driven by profit repatriation linked to foreign direct investment (FDI) in Pakistan. During the period, foreign companies remitted $1.37 billion in profits against their FDI holdings, up 25.91% from $1.09 billion in 5MFY25. Outflows on account of portfolio investment, however, saw a slight decline of 4.43% year-on-year to $51.95 million from $54.36 million in the same period last year.
In November 2025 alone, repatriation of profits and dividends by foreign firms amounted to $281.44 million, reflecting continued outflows despite efforts to attract and retain foreign investment in the country.
Sector-wise data indicates that the Power sector led profit repatriation with $350.17 million, followed by the Financial Business sector at $310.32 million. The Communications sector recorded $116.33 million in profit outflows, while the Food and Tobacco & Cigarettes sectors repatriated $103.83 million and $81.2 million, respectively, during the review period.
Country-wise, China emerged as the largest recipient of repatriated profits, with firms and investors sending $379.83 million abroad in 5MFY26, up sharply from $97.02 million in the same period last year. In November alone, payments to China stood at $96.63 million.
The United Kingdom was the second-largest source of outflows, with $354.79 million repatriated during 5MFY26, compared to $412.68 million in 5MFY25. The Netherlands ranked third, repatriating $119.43 million, up from $29.08 million in the prior fiscal year, while the United States saw profit repatriation of $106.71 million during the same period.
Analysts note that while these outflows reflect strong investor returns on FDI and portfolio investments, they also underscore the persistent reliance of Pakistan’s economy on foreign investment inflows for capital formation. The concentrated outflows in the Power, Financial Business, and Communications sectors indicate that key industries continue to generate significant earnings for foreign stakeholders, which are subsequently remitted abroad.
The SBP data highlights the importance of balancing foreign investment inflows with policies that encourage domestic reinvestment and sectoral growth, ensuring that capital repatriation does not constrain the economy’s long-term development.
As Pakistan seeks to attract more foreign investment amid macroeconomic challenges, monitoring the patterns of profit repatriation and maintaining investor confidence will remain critical to sustaining financial stability and supporting domestic economic growth.
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