The current financial year has not begun auspiciously. Foreign Direct Investment has registered a decline in July-August compared with the same period last year, while foreign portfolio investment also witnessed a decline. Foreign investment, which is either invested directly in bricks, mortar and factories, or in a nations stock markets, was an important source of foreign exchange for an economy which saw significant pressures on its foreign exchange reserves last year. A government claiming as much commitment as this one to obtaining foreign investment rather than foreign aid would do well to tackle the main underlying cause why there is not enough investment in Pakistan, whether foreign or local, and that is the poor security situation. That security situation is in turn determined by the progress in the War on Terror, more specifically Pakistans internal struggle against terrorism. The government is responsible for ensuring that business can be carried out in an atmosphere of normalcy and without fear of militancy. So far, by following the wishes of foreign powers rather than its own interests, the government is merely discouraging foreign investment, as the figures show.