Pakistan’s economic stabilisation offers encouragement, but sustained reforms and consistent policies remain essential to attract long-term investment, British International Investment (BII) said. “Recent progress towards macroeconomic stability is encouraging and can help strengthen investor confidence,” said Imtiaz Saithna, BII’s Pakistan head. However, he cautioned that “continued reforms and policy consistency will be important to sustain that momentum”. His assessment follows Pakistan’s reported GDP growth of 3.7% in fiscal year 2025-26. Policy certainty key to investment BII, the UK government’s development finance institution, previously operated as CDC Group. Its Pakistan portfolio totals nearly $360 million across 38 businesses, focusing on climate finance, financial inclusion and venture capital. The institution has invested in Pakistan since the late 1980s. Read More: PIA and Norse Atlantic Strike Deal to Expand Pakistan–UK Travel Saithna offered no fresh investment target or expansion timeline. However, he identified macroeconomic stability, easier business conditions, stronger institutions and predictable regulation as priorities. “Investors also look for clear rules, efficient markets and a transparent legal and contractual framework.” BII would continue supporting viable businesses through economic difficulties while maintaining disciplined risk management, he said. “The country has capable businesses, entrepreneurial talent and strong investment demand,” Saithna said. However, limited financing restricts growth and job creation among SMEs, farmers, women entrepreneurs and underserved communities. Institutional investors also need reliable information and commercially sound opportunities. Financing farmers and small businesses Small businesses and agriculture underpin employment and food security, making them central to BII’s approach. It channels funding through financial institutions and investment platforms. A $15 million BII risk-sharing commitment with Pakistan Microfinance Investment Company aims to unlock up to $30 million in additional lending. PMIC’s September announcement confirms the arrangement will expand financial access and strengthen climate resilience. “By sharing risk, the facility enables PMIC to expand lending through microfinance providers and reach customers who may otherwise struggle to access formal financial services.” Separately, BII committed $50 million to Bank Alfalah for climate finance and established a $75 million facility with HBL. Bank Alfalah’s facility also includes technical assistance for identifying climate projects. Meanwhile, HBL plans to direct half its facility towards smallholder farmers, according to BII’s announcement. The HBL partnership also supports climate adaptation measures, including solar-powered irrigation, to improve agricultural resilience and productivity. Climate finance and energy priorities “We have also invested in Mega Motors to support electric vehicle manufacturing in Pakistan,” Saithna said. Other investments include Daraz.pk, Jhimpir Power, KASHF Foundation and Zhenfa Pakistan New Energy Company. BII’s renewable energy portfolio supplies more than 460MW, including the 100MW Atlas Solar project and 50MW Zephyr Wind Farm. Read More: Bank Alfalah and UK’s BII Join Hands to Fund Pakistan’s Green Future Saithna identified climate finance as essential for Pakistan’s resilience and sustainable growth. “We agree with the government that investment in transmission and distribution infrastructure is a priority for the power sector,” he said. BII hopes to share experience from other markets as Pakistan addresses these infrastructure needs. Over the next three to five years, stabilisation could attract more long-term funding into productive sectors, Saithna said. “BII’s role is to help catalyse that investment by working alongside local institutions and private investors,” he concluded.