Repatriation of profit, dividends falls by 4pc

KARACHI: Repatriation of profits and dividends by foreign companies operating in Pakistan fell 4 percent during the first nine months of the current fiscal year (FY20).

According to the State Bank of Pakistan (SBP), foreign investors repatriated some $1.004 billion as profit and dividends during July-March of FY20 compared to $1.049 billion in the same period of the last fiscal year (FY19), depicting a decline of $45 million.

The overall decline in repatriation of profit is due to the contraction in the Foreign Portfolio Investment (FPI), down 31 percent or $50 million.

Detailed analysis revealed that during the period under review, a major amount of profit and dividend was sent abroad on account of Foreign Direct Investment (FDI). Cumulatively, some 89 percent of repatriated amount was sent as return on FDI.

An amount of $895 million was repatriated as return on the FDI in the first nine months of this fiscal year against $889 million during the corresponding period of the last fiscal year, showing an increase of $6 million.

Similarly, foreign investors repatriated some $110 million on account of Foreign Portfolio Investment (FPI) in July-March of FY20 down from $160 million in the same period of the last fiscal year.

The highest outflow of profit and dividends amounting to $203 million was from the oil and gas sector followed by $162 million from financial services during July-March of FY20. Transport was the third largest sector from where foreign investors transferred some $140 million on account of profit and dividend.

On month-on-month basis, foreign investors repatriated $31 million in March 2020. This amount includes $25.5 million as return on FDI and $5.2 million as return on FPI.—RIZWAN BHATTI