The China-Pakistan Economic Corridor (CPEC), a strategic cooperative initiative between China and Pakistan worth an estimated $62 billion, has indisputably reshaped the landscape of foreign direct investment (FDI) in Pakistan. Since its inception in 2013, the total net FDI in Pakistan has seen a significant increase. For instance, between 2013 and 2019, the net FDI increased from $1.45 billion to $2.24 billion, representing a growth of over 54% (State Bank of Pakistan, 2020). The majority of CPEC funding would go toward energy and infrastructure projects. Energy projects will get $33 billion of the overall funding. The energy imbalance has been cut in half from 4,500 MW in 2013 to nearly nothing in 2020 because of these initiatives (Javaid & Javaid, 2018). The geographical distribution of this investment, however, reveals a concentration in Punjab and Balochistan, leaving behind other provinces like Sindh and Khyber Pakhtunkhwa. This imbalanced distribution could exacerbate regional inequalities, potentially stoking socio-economic tensions. Although the energy and infrastructure sectors have benefited greatly from FDI, other industries, including agriculture, manufacturing, and services, have not seen the same level of investment. This discrepancy may indicate an over-focus on a few industries, underlining the need for more diverse investment to support long-term development. Constant discussion surrounds the long-term effects of this huge FDI inflow. Proponents say it can improve infrastructure, end energy shortages, and spur economic development. However, critics warn about the growing debt, with debt payment costs projected to reach a high of roughly $5 billion by 2022 (Wolf, 2020).

Keywords: FDI, Investment, CPEC, China, Pakistan.