Three countries have withdrawn nearly $1 billion from Pakistan’s treasury bills this financial year. This trend shows a concerning balance between inflows and outflows of foreign investments. From July 1 to March 14, 2025, inflows totaled $1.163 billion, while outflows reached $1.121 billion. As a result, the net balance stands at only $42 million.
The United Kingdom, traditionally Pakistan’s largest investor in T-bills, withdrew $625 million from its $710 million investment. Additionally, the UAE and the US made significant withdrawals of $205 million and $130 million, respectively. This near-parity highlights investor caution despite attractive returns on treasury bills.
Despite the government’s efforts to attract foreign investment, success remains limited. Although higher yields are offered on T-bills, investors are still wary. The fragile state of Pakistan’s external sector and its substantial $25 billion annual external debt servicing are major concerns for foreign investors.
Moreover, even with recent optimism from the IMF’s loan approval and record remittance inflows, challenges persist. Export growth remains sluggish, and foreign exchange reserves have fallen to a nine-month low. These factors continue to affect investor confidence and the overall economic outlook.