Federal Minister for Economic Affairs Omar Ayub Khan witnessed the signing ceremony of the Capital Market Development Program (Subprogram 2) amounting to $300 million between the Economic Affairs Division and Asian Development Bank (ADB).
The objective of the program is to strengthen market stability, enhance market facilitation, enhance supply-based measures and improve demand-based measures for capital market development. It will help develop Pakistan’s capital markets, promote private investment in the country, and mobilize domestic resources to finance sustainable growth.
As per the details, Pakistan has successfully completed 19 prior policy actions under the Capital Market Development Program (Subprogram 2). These include market stability strengthened, market facilitation enhanced, supply measures enhanced, facilitate and expand the issuance of sovereign sukuks, facilitate listing of SOEs on the PSX to broaden and deepen the capital markets, promote the introduction of alternative asset classes, such as exchange-traded funds, options, futures, and sharia-compliant (compliant with Islamic principles) products; and issuing a framework for women entrepreneur bonds whose proceeds will help finance SMEs owned or led by women as well as demand measures enhanced.
The Minister for Economic Affairs acknowledged the ADB’s continued assistance to the government of Pakistan. It was further highlighted that Pakistan has recently completed various reforms under ADB’s technical and financial assistance including Trade & Competitiveness Program ($800 million), energy sector reforms and financial sustainability program ($600 million) and capital market development program ($600 million).
The Minister expressed that the government is also committed to introduce reforms in other areas such as domestic resource mobilization, climate change and public-private partnerships. Domestic resource mobilization would help the government to create fiscal space through enhanced revenue collection and overcome the challenge of fiscal deficit.
The minister further stressed on using digital tools for effective project management and monitoring. At present, 37 ADB-funded development projects amounting to $7.9 billion are under implementation across the country in energy, road and transport, agriculture, urban infrastructure and social sector. During the current fiscal year, ADB has disbursed over $1.1 billion for various development projects and programs.
ADB Country Director Yong Ye acknowledged the GoP’s efforts for completing reforms in the capital market. He also discussed the ADB’s ongoing portfolio and future interventions. He highlighted the various issues pertaining to the energy sector including MFF Power Transmission Enhancement Investment program II (Tranche 3) and Greater Thal Canal Irrigation project. He also shared that ADB will provide support to EAD for development of e-portal for effective project management.
