The repatriation of profits and dividends from foreign investments in Pakistan soared to $139 million in July 2024, marking a 64.5-fold increase from just $2.2 million in July 2023, according to data released by the State Bank of Pakistan.
Despite this surge, there was a notable 66.4% decrease in month-on-month outflows of profits and dividends in July, compared to the $415 million sent abroad by multinational companies and foreign investors in the local stock market in the previous month.
The profit repatriation on foreign direct investment experienced a significant rise, reaching $133.9 million in July FY25, up from $1.5 million during the same period last year. Additionally, $5.3 million in profits and dividends from portfolio investments were paid out in July this year, compared to $0.6 million during the same period last year.
Interestingly, the outflow of repatriated profits and dividends exceeded the foreign direct investment (FDI) inflows totaling $136 million in July.
Sector-wise, the power sector experienced the largest outflow of profits and dividends, reaching $29.5 million in July, a 103-fold increase from the previous year. The transport sector followed with $21.2 million in repatriations, and the financial sector came in third with $16.1 million in outflows during the first month of the current fiscal year.
In a positive economic development, Pakistan saw a reduction in its current account deficit in July FY2025, attributed to an increase in remittances and an improvement in the balance of primary income. The deficit fell to $162 million, marking a 78% decrease from the previous year and a 48% decrease from the last month.
