British International Investment terms Pakistan's stabilisation 'encouraging', but calls for policy consistency

British International Investment (BII), the UK government's development finance institution, has expressed optimism about Pakistan's recent economic progress, which is bolstering investor confidence. However, BII emphasizes that sustained reforms and policy consistency are crucial to maintaining this momentum. In a recent interview, Imtiaz Sahina, BII's head of Pakistan, pointed out that while Pakistan's economy showed a cautious recovery and stabilisation in the fiscal year 2025-26, with a GDP growth rate of 3.7%, continued reforms will be essential for sustaining this progress.

BII, which has been investing in Pakistan since 1987, focuses on climate finance, financial inclusion, and venture capital. The investment portfolio, valued at nearly $360 million across 38 businesses, includes notable investments in Bank Alfalah, HBL, and Mega Motors. Sahina highlighted that Pakistan's main constraint for attracting long-term capital is ensuring access to finance for SMEs, farmers, women entrepreneurs, and underserved communities.

BII's strategy involves mobilising capital into developing economies, with a focus on climate change resilience. The institution has committed $15 million to a risk-sharing facility with Pakistan Microfinance Investment Company, which aims to unlock up to $30 million in additional lending. BII's recent investments in Bank Alfalah and HBL further demonstrate its commitment to climate finance and sustainable development.

The company also owns renewable energy assets in Pakistan, providing over 460MW of clean energy. Looking ahead, BII sees potential for more long-term capital to flow into productive sectors of the economy once stability is achieved.