- July 21, 2026
- Posted by: Tresmark
- Category:
No Comments
The repatriation of profits and dividends from foreign investors in Pakistan increased by 3.87 per cent in the last fiscal year that ended in June, the central bank data showed on Monday.
Overseas investors repatriated $2.305 billion in earnings in FY26, compared with $2.219 billion in the previous year.In May alone, Pakistan recorded profit and dividend repatriation of $151.4 million, up 32.6 per cent from a year earlier.
During the period from July to June of FY26, foreign companies repatriated $2.201 billion in profits from their foreign direct investments across various businesses. This amount marks an increase from $2.104 billion during FY25. Additionally, profit outflows linked with portfolio investments amounted to $103.7 million, down from $115 million in the previous year.
The easing of profit repatriation is, in itself, a healthy signal, said Saad Hanif, head of research at Ismail Iqbal Securities Limited. “It shows multinationals can now move earnings freely, and that reflects both improved corporate profitability and a normalised external account after years of dollar rationing,” Hanif said.
“That is exactly the kind of predictability foreign investors want to see, and it strengthens Pakistan’s credibility as a destination that honours its commitments,” he added. However, he believes the concern lies in the balance, not the outflow. In the first eleven months of FY26, profit repatriation of $2.15 billion exceeded net FDI by about 32 per cent, which means the country is currently paying out more on old foreign investment than it is attracting as fresh capital, he said.
“For now, this is comfortably absorbed since the record remittance inflow held the external account steady and allowed reserves to keep rebuilding,” he said, and added the repatriationfreedom is only half the equation. “The real test is whether that same confidence translates into new inflows. If FDI revives, this normalisation becomes a virtuous cycle; if it does not, the primary income outflow stays a recurring drag that remittances must keep offsetting.”
Pakistan recorded a current account deficit of $139 million in FY26, a shift from a surplus of $1.8 billion in the previous year, due to a widening trade imbalance driven by increased imports and declining exports.The foreign exchange reserves held by the State Bank of Pakistan have increased from approximately $3 billion in 2023 to $17.2 billion as of July 10, 2026.
