The Overseas Investors Chamber of Commerce and Industry (OICCI) on Tuesday released the results of its Business Confidence Index (BCI) Survey Wave 29, revealing a marked deterioration in business sentiment, with the overall BCI falling 9% to 13%, down from 22% in Wave 28.
Conducted across Pakistan in the second quarter of 2026, the survey reflects the decline in investment confidence, supply chains, and economic growth prospects amidst the ongoing Iran war.
The survey has attributed the decline to elevated inflationary pressures, rising fuel costs, and the intensifying fallout from the war in the Middle East. The services sector recorded the sharpest drop, falling 20 points to 14%, while manufacturing declined by 7 points. The retail sector was the only segment to show improvement, rising 3 points to positive 20%. Investment intentions have weakened sharply, with the New Investment Index collapsing 10 points to just 2%, reflecting a near-total freeze in near-term capital deployment.
Around 70–80% of businesses across all sectors are delaying or revising investment decisions and diversifying supply chains to reduce exposure to affected trade routes. The strategic focus is shifting towards risk mitigation and operational resilience. The survey’s global business situation indicator deteriorated by 31 points, and businesses across all sectors expect the disruption to persist well beyond six months.
“The results of Wave 29 are a clear signal that businesses operating in Pakistan are navigating an increasingly complex environment,” said M. Abdul Aleem, OICCI secretary general. “The ripple effects of the Middle East conflict are being felt across every sector, from investment freezes to supply chain restructuring. While the fundamentals of the Pakistani market remain intact, restoring business confidence will require policy stability, cost relief, and a concerted effort to shield the economy from prolonged geopolitical uncertainty.”
Looking ahead, 34% of respondents anticipate a negative outlook over the next six months, up sharply from 22% in Wave 28, with political instability, fuel prices, and inflation cited as the top concerns. When asked about the key structural threats to business growth, rising inflation topped the list at 84%, followed by high taxation at 79%, and concerns over currency stability and inconsistent government policies both at 61%. Business confidence among OICCI member companies, representing the country’s leading foreign investors, remained relatively resilient, improving marginally to positive 28%.
Metropolitan confidence fell 12 points to 11%, while non-metro cities including Peshawar, Quetta, Rawalpindi, Multan, Sialkot, and Sukkur saw a modest 3-point improvement to 22%.
On a forward-looking note, the survey found growing business interest in generative A.I. adoption, with OICCI member companies showing notably higher readiness for large-scale integration across technology platforms, core business processes, and workforce development, signaling that despite near-term headwinds, leading foreign investors are positioning for long-term transformation.
The BCI Survey is conducted by OICCI twice a year, covering participants representing approximately 80% of Pakistan’s GDP.