Oil and gas sector fetches $612 million investment

KARACHI - Inflow of Foreign Direct Investment (FDI) in oil and gas exploration sector increased to $612.1 million, during July-April of financial year 2008-2009. The FDI inflow in this sector was $509.4 million during the same period of financial year 2007-2008.
Petroleum refining sector in the country has attracted good share of FDI, as the amount of investment touched the mark of $103.7 million during July-April 2008-2009 period.
It is worth mentioning that the FDI inflow has increased in this sector as this amount was $74.5 million during the whole financial year of 2007-2008.
The Petrochemical industry has the share of $24.1 million in the FDI in Pakistan during the July-April of fiscal year 2008-2009. This share was of $27.4m in the whole financial year of 2007-2008.
It is note worthy that the power sector of the country has also got huge FDI during this financial year. The investment made by foreign investors in this sector amounts $80.2m during July-April 2008-2009. However, the investment in this sector was $52.2 million during the same period in the fiscal year 2007-2008.
The sharp rise in the investment in this sector is due to the power crisis faced by the country from last few years. The country is still facing huge power shortfall which is affecting the common consumer and industrial sector at large. To keep the economic cycle moving in better direction, it is the need of time to have more foreign investment in the power sector.
It is worth mentioning that foreign investment in the petroleum sector will enhance in this year due to the positive incentives that have been introduced in the new petroleum policy.
It is worth noting that the petroleum policies need frequent revisions as technology, legal practices, tax laws, price-setting and environmental standards continue to evolve around the globe. The 2009 policy redefines the previous policies to accommodate new market conditions, particularly the steep rise in international energy prices.
The 2009 policy provides procedural and price incentives for exploitation of natural petroleum resources. It envisions the development of local firms and human resource augmented with increased foreign investment. The policy proposes competitive terms of investment for foreign firms and incentives to encourage participation of local oil and gas companies.