ISLAMABAD: Pakistan has emerged as the lowest-investing country in Asia, with its investment-to-GDP ratio significantly lagging behind regional peers, according to the latest economic data.
The figures show that investment in Pakistan stands at 13.8% of gross domestic product (GDP), and the country has yet to recover its peak level of 15.6% recorded in fiscal year 2022.
In comparison, Bangladesh maintained a stronger performance despite political and economic turbulence in 2025, with its investment-to-GDP ratio reaching 22.4%, considerably higher than Pakistan’s. Analysts said the disparity reflects differences in policy stability and the overall investment climate between the two countries.
Other regional economies, including India and Vietnam, continue to sustain investment rates above 30%, supported by industrial expansion, export growth, and infrastructure development, which have strengthened investor confidence. In contrast, Pakistan has struggled with policy continuity and slow-paced administrative reforms.
Industrial stakeholders noted that despite the establishment of investment facilitation mechanisms at the federal level, structural bottlenecks persist. High energy costs, a complex tax regime, import restrictions, and bureaucratic delays remain key obstacles to investment.
Business leaders also pointed out that launching an industrial project requires approximately 25 approvals from federal and provincial authorities, creating delays, additional costs, and uncertainty that discourage both domestic and foreign investors.
Economists stressed that Pakistan must simplify procedures, ensure policy consistency, reduce unnecessary approvals, and improve transparency to place the economy on a sustainable growth trajectory comparable to regional competitors.