Adviser to Finance Minister Khurram Schehzad visited the Pakistan Stock Exchange (PSX) on Tuesday, reaffirming the government’s commitment to supporting capital market growth.
In a press release, the PSX said Schehzad visited the Stock Exchange on the invitation of CEO Farrukh Sabzwari. The two, it said, met with the senior management of the PSX and discussed strategies to enhance the depth and performance of the capital market. The PSX management gave Schehzad a comprehensive overview of its strategic initiatives, aimed at unlocking the full potential of Pakistan’s capital markets.
During their meeting, the PSX CEO emphasized that, despite challenges, Pakistan’s capital markets had immense potential. He expressed confidence that the PSX could realize this potential and significantly contribute to the national economy through a well-formulated strategy. Reaffirming the government’s commitment to supporting capital market growth, the adviser said authorities recognized its role in stabilizing and underpinning growth in the economy.
Schehzad urged the PSX management to formalize recommendations for structural changes and privatization of state-owned enterprises, stressing this could advance governmental goals and boost market capitalization. He also recommended rebranding and repositioning the Growth Enterprise Market board to function as a platform for venture capital and startup fundraising.
Among the key initiatives discussed between the adviser and the PSX management were concrete steps aimed at facilitating high-value listings to increase market capitalization and attract foreign investment. The meeting also discussed means to expand the investor base to 2% of the national population within three years by engaging brokers and mutual funds. Schehzad and the PSX management further discussed the introduction of new investment products, such as Exchange-Traded Funds, options markets, and derivatives, to enhance market attractiveness. They also exchanged views on exploring algorithmic trading and robo-advisory services, taking inspiration from successful implementations in countries such as China.
During the meeting, Schehzad emphasized the need for the PSX and the Securities and Exchange Commission of Pakistan (SECP) to collaboratively devise a roadmap that increases Pakistan’s weight within the MSCI Frontier Markets index, ultimately achieving inclusion in the MSCI Emerging Markets index.
Schehzad also endorsed a recommendation to form a formal committee comprising PSX, SECP, and the State Bank of Pakistan (SBP) to leverage each entity’s strengths. This initiative aims to foster financial inclusion, enhance public awareness, and promote seamless digitization. Promoting the KSE-100 Index’s remarkable returns was identified as an essential task for brokers and market participants.
The adviser also praised the relaunch of cash-settled futures as a significant step toward developing Pakistan’s derivatives market. The meeting’s participants also stressed on collaboration with Chinese capital markets to facilitate cross-border investment opportunities, broaden market access, and stimulate investor participation. With these initiatives, they opined, Pakistan’s capital market is poised for significant growth, driving economic development and stability.