This study investigates that either the firms in manufacturing sector of Pakistan are facing external financial constraints or not along with that this study also explores investment cash flow sensitivity in different regimes. We used a panel data of 500 manufacturing sector firms over the period of 1974 to 2010 and the sample is divided into different time periods on the basis of different political regimes, pre and post financial sector reform era in the history of Pakistan. Generalized Method of Moments, one step and two step estimation techniques have been applied for analysis. Results obtained for the full sample indicates that overall firms are not facing external financial constraint. The analysis of financial constrains in different political regimes reveals that merely from 1978 to 1988 firms were facing external financial constraints whereas empirical results for pre and post financial sector reform periods reveals that firms were facing tight external financial constraints in pre financial sector reform era as compared to post financial sector reform era.