KARACHI: Foreign direct investment (FDI) in 2014-15 more than halved to $709 million, one of the worst annual figures, the State Bank of Pakistan (SBP) said on Wednesday.

It was a sharp decline of 58 per cent when compared with the preceding fiscal year`s FDI of $1.667 billion.

It is surprising that FDI has dried up when the government claimed to have pulled the economy back from the edge.

In May 2015, the FDI was a nega-tive $7m. In June, it fell further to minus $94m indicating that no country was ready to invest in Pakistan.

Thegovernment meanwhile watches as a bystander ignoring the fact that almost all regional countries are getting billions of dollars in FDI.

The worst year in more than a decade regarding the FDI was FY12 when it fell to $820m, but FY15 proved even worse with $709m.

While the domestic investment is in the same ugly shape, analysts said the situation is extremely embarrassing for the government which loves to tell people that economy is about to pick up.

Banks invest 96pc of their invest-ment in the government papers which is non-productive for the economy. It reflects that the economy is being run without a strategy with a slogan of Chinese investment. Though China was one of the biggest investors so far, the size of investment is not something that can be described as a game-changer.

China invested $229.5m in FY15, much below than preceding year`s $695.8m. The government has signed a $45bn agreement with China for investment in Pakistan, but the outcome has so far been insignificant.

In 2014-15, the highest FDI landed from the United States($238.7m), followed by $222.4m fromtheUAE.

It suggests that $690m or 97pc of the total FDI came from just three countries. It should be a source of concern for Pakistan`s economic managers since it seems that the country is in isolation regarding the foreign investment.

On the other hand the highest withdrawal of $175m was by France followed by Saudi Arabia which withdrew $128m.

The overall picture shows the country could not be projected as a viable destination for foreign investment despite improvement in the law and order situation.