Pakistan seeks to convert improved US relations into economic investment

Pakistan’s Ambassador to the United States, Rizwan Saeed Sheikh, stated that bilateral relations between Islamabad and Washington are currently on a stronger footing than in previous years. Speaking at an event organized by the Pakistani American Press Association, Sheikh emphasized the need to transform this improved environment into a long-term, results-driven partnership, specifically through expanded economic cooperation in trade and investment.

While diplomatic ties have shown resilience and strategic importance, economic challenges remain. Shahzad Arif, CEO of AKS iQ, noted a disconnect between Pakistan’s growing strategic relevance and its ability to attract sustained foreign investment. Despite diplomatic momentum, net foreign direct investment (FDI) for the year ending June 2026 fell by 34.3 percent to $1.637 billion, while outflows reached a six-year high of $1.931 billion. Experts suggest that for diplomacy to yield economic results, Pakistan must address domestic investor concerns regarding regulatory predictability, taxation stability, and contract enforcement.