Govt seeks wider issuer base, deeper liquidity in corporate debt market

October 30, 2026 (MLN): The government has stressed deepening the corporate debt market and widening the issuer and investor base, as corporate debt issuances reached Rs291bn during January-September 2026, following Rs326bn raised in 2025, a 30% increase over 2024.

Finance Minister Senator Muhammad Aurangzeb chaired the fourth meeting of the Capital Market Development Council (CMDC) at the Finance Division to review progress on capital market reforms, said a press release issued.

The meeting was attended by the Chairman of the Securities and Exchange Commission of Pakistan (SECP), representatives of the State Bank of Pakistan (SBP), Pakistan Stock Exchange (PSX), Pakistan Banks’ Association (PBA) and the Tax Policy Office, and senior Finance Division officials.

The council was told that 12 new corporate debt issuances worth Rs45.4bn were listed between February 2025 and September 2026, reflecting growing activity in Sukuk and other debt instruments.

It stressed the need to encourage more public offerings and let a wider range of businesses tap capital market financing.

The meeting discussed a proposed Shariah-compliant Sukuk programme of the National Grid Company of Pakistan Limited (NGC), with a total size of up to Rs100bn and an inaugural issuance of up to Rs20bn with a tenor of up to 10 years.

The Sukuk would be issued in tranches through public offerings listed on the PSX, subject to approvals and market conditions.

The finance minister welcomed the move as a chance to show the potential of listed corporate debt and to encourage similar issuances by others.

The council noted that dedicated Corporate Debt Market Desks have been set up at the SECP and PSX to guide potential issuers, and the finance minister called for more outreach so that issuers make greater use of them. The one-window listing mechanism is already running through the SECP and PSX, while work is under way to bring the Central Depository Company (CDC) into it.

The meeting reviewed a reform agenda under four working groups covering tax and fiscal matters, debt and issuance, market infrastructure, and investor protection and enforcement.

The workstreams aim to address tax-related distortions, simplify issuance and listing, cut transaction costs, strengthen liquidity and investor safeguards, and promote innovative instruments such as green and thematic Sukuk.

On the secondary market, the council noted average daily traded value rose from Rs3.93bn in FY2026 to over Rs10bn in FY2027 so far, as of October 15, 2026.

Thirteen banks have been onboarded for secondary-market trading, backed by engagement among the PSX, PBA, CDC and the National Clearing Company of Pakistan Limited (NCCPL).

The finance minister stressed the need to sustain liquidity and broaden participation.

The council also reviewed steps to facilitate banks’ participation in government Sukuk trading through the PSX, including existing arrangements that let banks and other eligible institutions trade government securities without broker accounts.

It also discussed regulatory and operational considerations for Sukuk-based liquidity facilities.

To broaden the institutional investor base, the SECP briefed the council on consultations with 17 pension fund managers and 44 insurance companies.

These identified room to improve the supply of suitable debt instruments, secondary-market liquidity, issuer disclosures and the wider investment framework. The council stressed the need to turn the consultations into practical measures.

The meeting reviewed outreach to potential issuers, including SMEs, medium-sized and non-blue-chip companies.

The finance minister called for greater priority to SME access to capital market financing and directed the SECP to work with the PSX and other platforms on practical solutions.

He also urged stronger engagement between investment banks, financial advisers, consultants and prospective issuers, with the Pakistan Business Council (PBC) and PBA, to build a stronger pipeline of corporate financing deals.

The finance minister encouraged the SECP and PSX to renew engagement with MSCI to explore Pakistan’s possible reclassification to Emerging Markets status.

He referred to his positive interaction with the MSCI team on the sidelines of the IMF-World Bank Annual Meetings in Bangkok earlier this month, and stressed the need for sustained dialogue.

Senator Aurangzeb said the next phase of capital market development must focus on turning reforms into higher issuance, deeper liquidity and wider investor participation.

He highlighted the importance of widening financing options beyond bank lending, mobilizing domestic savings for productive investment and enabling more businesses to access long-term capital.

He urged all stakeholders to maintain momentum, address remaining bottlenecks and engage closely with issuers and investors to build a more diversified, efficient and accessible market.

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