This study investigates the potentials determinants of foreign direct investment of Pakistan and its potential competitor neighboring economies by using annual time span from 1975 to 2016. Variables included in this empirical analysis are taken from two economic approaches, market oriented approach and export oriented approach. Using all features at once, lead to the problem of high dimension. To mitigate this problem, we employ contemporary efficient statistical; SCAD technique is employed. ARDL (2) model is applied for determinants of FDI in case of Pakistan and its neighboring economies; such as India, Bangladesh, and China. The general to specific approach is used to reach parsimonious model for individual countries separately. ARDL Bound test approach is used to examine the long run relationship among regressors.. According to Bound test of co-integration, there exist co-integration among predictors and FDI inflow. The long run and short run analysis has been done and results are quite interesting for above countries. The results show that none of theory dominated by one another. Role of trade and population has positive and significant in China and Pakistan. Per capita income remained negative and significant in attraction of foreign firms in big economies like India and china. Positive and significant impact of exchange rate is comes in the long run and short run analysis of China and India. The long run disequilibrium captured by ECM term remained toward convergence and significant in all countries. Supervisor:- Dr. Saud Ahmed Khan