Pakistan Investment Up to 13.8%, Targets Unmet

Pakistan’s investment ratio has edged up to 13.8% of Gross Domestic Product (GDP) for Fiscal Year 2025, per figures endorsed by the National Accounts Committee, yet it falls short of the official target of 14.2%. This modest rise from 13.1% last year masks a persistent struggle, as private investment remains stagnant despite government efforts to lure non-debt-creating foreign inflows. The public sector investment climbed to 2.9%, driving the overall improvement, but private sector investment at 9.1% lags behind the targeted 9.7%, exposing deep-rooted challenges.

The government’s ambitious push has faltered, particularly with flagship initiatives like the Special Investment Facilitation Council (SIFC), launched to streamline investment processes and remove growth barriers. After two years, the SIFC has failed to deliver noticeable investment inflows. Likewise, the Pakistan Sovereign Wealth Fund (PSWF), meant to attract Middle East investment, lies dormant due to legal framework disputes with the International Monetary Fund (IMF), prompting a commitment to revise its governance structures by March 2026 for transparency and international alignment.

The IMF’s latest report projects foreign direct investment (FDI) at a mere 0.5% of GDP for FY2025, a slight dip from last year, stressing the need to resolve trade policy issues and improve the tariff structure to unlock competitiveness. The government vows to amend the SWF law by March 2026, focusing on FDI attraction, co-investment in strategic ventures, and financial returns. Web context highlights Pakistan’s historical FDI struggles (e.g., below 1% of GDP, web ID: 0), while posts found on X reflect frustration—some doubt SIFC efficacy, others blame IMF conditions. Critically, the narrative of “improvement” may mask systemic failures—web sources note infrastructure gaps, and X sentiment suggests skepticism about government promises, hinting at underlying economic fragility.