KARACHI (Reuters) - Foreign investment in Pakistan fell 5.8 percent to $1.739 billion in the first 11 months of the 2010/11 fiscal year because of a decrease in foreign direct investment, the State Bank said on Tuesday.
Foreign investment totalled $1.847 billion in the same period last year.
Foreign direct investment fell 29.7 percent in the July-May period to $1.392 billion from $1.981 billion in the same period last year, the State Bank of Pakistan said.
Pakistan’s unstable security, a Taliban insurgency in the country’s northwest and chronic power shortages have put off long-term investors, analysts say.
However, with emerging markets increasingly on the radar of fund managers, Pakistan has seen a flow of foreign investment in the country’s main stock exchange.
Foreign portfolio investment rose 359.6 percent to $347.1 million in the first 11 months of 2010/11, compared with an outflow of $133.7 million in the same period last year.
Pakistan has struggled with a troubled economy and an International Monetary Fund (IMF) emergency loan package agreed in November 2008 helped it avert a balance of payments crisis and shore up reserves.
It received the fifth tranche of $1.13 billion of the $11 billion loan in May 2010. Pakistan and IMF authorities are due to meet in July to discuss the possible release of the next tranche.
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