The Pakistani economy continues to slip. On Friday, the State Bank of Pakistan (SBP) reported that foreign direct investment (FDI) had fallen by 41 percent to $168.8 million in February. At the same time last year, the country had an FDI of $286.5 million.The SBP’s revelation seems to have put a damper on the optimism that had followed the visit of Saudi Crown Prince Muhammad Bin Salman to the country last month when he had announced $20 billion in investment. It must be noted that the Indian Air Force’s incursion into Pakistani territory and the cross border hostilities that followed are a significant factor here. War is always bad for business, and the Pakistan Tehreek-e-Insaf (PTI) must remain committed to maintaining peace with New Delhi if it intends on reviving the economy. However, international fears of another Indo-Pak conflict can’t be termed the sole cause of the falling FDI. What the SBP revealed on Friday is part of an overall trend. On February 18, the SBP had reported that foreign investment had shrunk by 75 percent in the first half of the ongoing fiscal year; FDI fell by 17 percent, while the stock market had lost $400 million. The country’s gross official foreign currency reserves also stand at a paltry $8.1 billion, despite receiving a collective $6 billion from Saudi Arabia, the UAE and China over the past eight months.Taking the aforementioned data into account, it is no wonder that the incumbent government has approached the Asian Development Bank for a $500 million loan. Given the present situation, another loan from the International Monetary Fund also seems likely. The PTI government’s main objective must be to improve the ease of doing business in Pakistan. According to the World Bank’s latest annual ratings, the country is ranked 136 out of 190 in the Ease of Doing Business Index. The government’s decision to introduce a new electronic visa policy for 175 countries is a positive development here, but this alone will not be enough.The PTI government must address the country’s economic problems on a war footing. This must also include taking action against armed groups of all hues and colours in order to prevent Pakistan from landing on the FATF blacklist, and ultimately getting out of its greylist as well. Furthermore, it must also consider the economic implications of its aggressive and politicised accountability drive. * Published in Daily Times, March 17th 2019.