Investor confidence in Pakistan is showing signs of recovery, with 73 percent of foreign investors now recommending the country for future foreign direct investment (FDI), according to the Overseas Investors Chamber of Commerce and Industry (OICCI) Perception and Investment Survey 2025.
The figure marks a significant rise from 61 percent in 2023, reflecting improved macroeconomic stability, declining inflation, and a more stable currency environment.
The OICCI, representing over 200 leading foreign investors in Pakistan, noted that interest from parent companies has also grown.
About 35 percent of respondents said their global headquarters are now considering Pakistan as a priority destination for investment which is up from 24 percent two years ago.
OICCI President Yousaf Hussain said the improved sentiment demonstrates that policy coordination and economic reforms are beginning to deliver results.
He credited initiatives such as the Special Investment Facilitation Council (SIFC) for creating a more structured framework for investment facilitation and government alignment.
Investor perception of risk has also moderated, moving from a high-risk to a medium-risk outlook. However, the survey cautioned that longstanding bottlenecks continue to constrain growth, including poor federal–provincial coordination, which 57 percent of respondents rated as a major concern.
Despite stronger confidence, the majority of investors continue to face high operating costs and long refund delays
According to the survey, 96 percent reported higher energy costs, 95 percent faced increased wage expenses, 91 percent cited higher domestic raw material costs and over 80 percent complained that tax refunds take more than two years to process.
The report identifies IT and digital services, renewable energy, agriculture, pharmaceuticals, and export-oriented manufacturing as the most promising areas for future investment.
However, issues such as complex taxation, policy inconsistency, and high energy costs continue to hinder competitiveness.
OICCI CEO and Secretary General M. Abdul Aleem said that while investor confidence has improved, the real challenge lies in execution.
“Critical areas such as business costs, tax complexity, and contract enforcement need immediate attention,” he said. “Harmonizing tax policies and simplifying regulations will be essential to convert optimism into actual FDI inflows.”
The OICCI report highlighted that while Pakistan’s investment climate is improving, sustaining momentum will depend on the continuity of reforms and clear communication of policy direction.
