KARACHI: Pakistan witnessed a substantial increase in foreign investment through the stock market in the last three weeks after international corporations and overseas Pakistanis brought $19.9 million into the country, reflecting improved investor confidence in the wake of the Feb. 8 polls, as confirmed by financial experts on Friday.
After months of uncertainty surrounding the general elections, Pakistan held the polls last month, though their conduct and outcome led to widespread speculations of vote fraud. The split mandate in the electoral contest was followed by political negotiations that led to a power-sharing agreement between Bilawal Bhutto Zardari’s Pakistan Peoples Party and the Pakistan Muslim League (PML-N) of three-time prime minister Nawaz Sharif.
Despite the allegations of rigging and ensuing political protests, the elections brought clarity to Pakistan’s capital market, which was reflected in the bullish sentiments including the rise in foreign equity investment.
Foreign corporations invested around $18.5 million in the equity market, while overseas Pakistanis bought shares worth $1.4 million after Feb. 8. In the last three weeks, the net investment amounted to $19.9 million, according to the National Clearing Company of Pakistan Limited (NCCPL), an institution that provides clearing and settlement services to the Pakistan Stock Exchange (PSX).
“The surge in the foreign portfolio investment reflects the clarity in the market after holding of general elections,” Khurram Schehzad, CEO of Alpha Beta Core, a financial advisory firm, told Arab News.
In February 2024 alone, the foreign investment amounted to $25.7 million as compared to the $8.5 million recorded in the corresponding month last year.
During July to February 2024, net foreign investment stood at about $59.6 million in equity market as compared to $16.3 million recorded during the same period in 2023.
Schehzad said the market would further consolidate after the formation of the next government.
Discussing the development, Ali Nawaz, CEO of Chase Securities, described the rise in foreign investment in the country’s equity market as “promising.”
“This can be attributed to factors like improved economic stability, successful International Monetary Fund loan agreement, and potentially positive policy changes anticipated under the new government,” he told Arab News.
“Once a stable government is formed, clearer economic direction and potential reforms will further incentivize foreign investors, making Pakistan’s stock market even more attractive,” he added.
The country’s equity market has witnessed a strong rebound during the latter half of the previous month, after the vote fraud allegations.
The stock market closed weekend trading session at 65,325 points after easing of political uncertainty. The formation of a coalition government at the center is expected to keep the investor sentiment positive.
“Stocks closed higher amid reports of inflation falling to 23 percent for February 2024 and the National Assembly session held to form the new government,” Ahsan Mehanti, CEO of Arif Habib Corporation, commented.
Mehanti said the American assurance to support Pakistan in its effort to break free from the vicious cycle of debt and international financing also played a key role in keeping the bullish sentiments alive at PSX.
Matthew Miller, spokesperson of the US State Department, noted on Thursday Pakistan’s economic stability was crucial to the long-term strength of its government.
“Pakistan’s new government must immediately prioritize the economic situation because the policies over the next several months will be crucial to maintaining economic stability for Pakistanis,” he said while responding to a question about the political situation of the country.
Foreign investment in Pakistan’s stock market surges to $19.9 million since Feb. 8 polls
https://arab.news/rv3km
Foreign investment in Pakistan’s stock market surges to $19.9 million since Feb. 8 polls
- Financial experts describe the development as a result of growing investor confidence in the country
- The stock market benchmark closes at 65,325 points after National Assembly held its first two sessions
Pakistan presses UN to prevent Afghan soil from being used against neighboring countries
- Pakistan, which faces a renewed surge in militancy, has frequently accused Afghanistan of allowing militant groups on its soil, an allegation Kabul denies
- Islamabad’s UN envoy says the UN Security Council has spoken with a unanimous voice and ‘it is for the Taliban to decide what path they wish to choose’
ISLAMABAD: Pakistan on Thursday urged the United Nations (UN) to prevent the use of Afghan soil by militant groups to threaten neighboring countries, saying “efforts must be made to prevent external spoilers from exploiting the situation.”
Pakistan, which has been witnessing a renewed surge in militant violence, has frequently accused Afghanistan of allowing militant groups, including the Tehreek-e-Taliban Pakistan (TTP) and the Baloch Liberation Army (BLA), to operate on its soil and India of backing them in attacks against Pakistan. Kabul and New Delhi deny the allegations.
The surge in militant violence in Pakistan triggered one of the worst skirmishes between Pakistan and Afghanistan in Oct. last year, after Islamabad hit what it called TTP targets inside Afghanistan. Pakistan has since suspended all trade with Afghanistan, despite a ceasefire reached between the neighbors in Doha that same month.
On Thursday, Pakistan voted in favor of a UN Security Council resolution that extended for 12 months the mandate of the team tasked with monitoring sanctions against the Taliban and their associated groups and individuals, welcoming the unanimous adoption of the resolution that is both “timely and necessary.”
“Pakistan remains seriously concerned by the active presence of terrorist groups on Afghan soil,” Islamabad’s permanent representative to UN Asim Iftikhar Ahmad said, while addressing the Council.
“We reiterate our call that Afghan territory must not be used for terrorism against neighboring countries and efforts must be made to prevent external spoilers from exploiting the situation.”
There was no immediate comment from the Afghan side to the statement, which came days after a suicide attack on a mosque in the Pakistani capital of Islamabad killed at least 32 people and injured dozens more. Officials said while the suicide attacker was a Pakistani national, he was trained in Afghanistan ahead of the bombing claimed by Daesh.
Unanimously adopting resolution 2816, the 15-member UNSC decided that all states will continue to implement the sanctions measures imposed both on the Taliban and related “individuals, groups, undertakings and entities” that threaten Afghanistan’s peace, stability and security.
It further renewed the mandate of the monitoring team charged with assisting the Afghanistan Sanctions Committee, which was first established in resolution 2011, for a period of 12 months from the date of its expiration this month. Among other tasks, the Council directed the monitoring team to gather information on instances of non-compliance with sanctions, keep the Committee informed of such instances and to provide recommendations on actions to respond to non-compliance.
“The Council has spoken with a unanimous voice today by highlighting these problems and remains committed to reviewing these sanctions as and when appropriate while taking into account the ground realities in Afghanistan,” Ahmad said.
“It is for the Taliban to decide what path they wish to choose for Afghanistan; whether it is the path to isolation or the path to peace and prosperity as a responsible member of the international community.”
