Finance adviser charts growth path for PSX

KARACHI: Adviser to the Finance Minister Khurram Schehzad visited the Pakistan Stock Exchange (PSX) on Tuesday on the invitation of its CEO Farrukh Sabzwari to discuss strategies aimed at enhancing the depth and performance of the country’s capital market.

During the meeting with the PSX’s senior management, Schehzad was briefed on the exchange’s strategic initiatives to unlock the potential of capital markets. The PSX CEO highlighted the immense opportunities within the market despite prevailing challenges, expressing optimism that a well-executed strategy could drive significant contributions to the national economy.

Reiterating the government’s commitment to fostering capital market growth, Schehzad mentioned its pivotal role in stabilising and supporting the country’s economic development. He urged the PSX management to formalise recommendations for structural reforms, including the privatisation of state-owned enterprises (SOEs), to align with government objectives and enhance market capitalisation.

He also proposed rebranding the GEM Board as a platform for venture capital and startup fundraising. Schehzad discussed introducing innovative investment products, such as exchange-traded funds (ETFs), options markets and derivatives to improve market attractiveness. Expanding the investor base was identified as a key target, with plans to increase participation to 2.0 per cent of the national population within three years by engaging brokers and mutual funds.

Schehzad stressed the need for the PSX and the Securities and Exchange Commission of Pakistan (SECP) to work together on a roadmap to increase Pakistan’s weight in the MSCI Frontier Markets index, with the ultimate goal of inclusion in the MSCI Emerging Markets index. He also endorsed the formation of a formal committee comprising the PSX, the SECP, and the State Bank of Pakistan (SBP) to leverage their collective expertise.

The relaunch of cash-settled futures was lauded as a major milestone for the development of the country’s derivatives market. Collaboration with Chinese capital markets was identified as critical to facilitating cross-border investment opportunities, broadening market access and encouraging greater investor participation.

Promoting the strong performance of the KSE-100 Index and instilling investor confidence were highlighted as essential tasks for brokers and other market stakeholders. Schehzad underscored the importance of fostering financial inclusion, raising public awareness and driving digitisation to position the capital market as a catalyst for economic stability and growth.