State bank of Pakistan has indicated a decline of about 46% in foreign direct investments in July 2010 as compared to FDI’s in July, 2009. Foreign Direct Investments level of about $98 million was observed in the month of July, 2010. However, Net FDI’s level has reached to $84 million as compared to $192 million of previous year. The chief reasons behind this decline are
- The deteriorating political and economic situation in the country.
- Increased Inflation rates, Energy crises, load shedding and rise in prices of the petroleum goods.
- Increase in Utility prices and interest rate.
The government should take strict measures to control the above factors. Changes in the current foreign investment related policies and infrastructure are also required to attract FDI’s.