Pakistan’s capital market institutions launch development fund to boost investor participation

Pakistan’s major capital market institutions on Wednesday signed an agreement to establish the Capital Market Development Fund (CMDF), a joint initiative aimed at promoting financial literacy, expanding investor participation and strengthening Pakistan’s capital markets.

The agreement was signed by Pakistan Stock Exchange, Central Depository Company, National Clearing Company of Pakistan Limited, Pakistan Mercantile Exchange and the Institute of Financial Markets of Pakistan under the supervision of Securities and Exchange Commission of Pakistan (SECP).

Federal Minister for Finance and Revenue Senator Muhammad Aurangzeb attended the signing ceremony at SECP headquarters in Islamabad as chief guest.

The agreement documents were signed by PSX Chief Executive Officer Farrukh H Sabzwari, CDC Chief Executive Officer Badiuddin Akber, NCCPL Chief Executive Officer Naveed Qazi, PMEX Chief Executive Officer Khurram Zafar and IFMP Chief Executive Officer Dr Mobashar Sadik.

SECP Chairman Dr Kabir Ahmed Sidhu and SECP Commissioners Imtiaz Haider, Muzaffar Mirza, Zeeshan Khattak and Ali Farid also attended the ceremony.

According to officials, the CMDF has been created as an industry-wide platform to improve financial literacy, encourage retail investment, support financial inclusion and strengthen institutional capacity in the capital market sector.

Addressing the ceremony, Senator Aurangzeb said recent regional tensions had highlighted the importance of making independent commercial decisions, diversifying energy resources and mobilising domestic capital for economic development.

He said Pakistan needed to strengthen self-reliance through local resources and deeper capital markets capable of financing economic growth.

The finance minister said Pakistan’s economic indicators were improving despite regional uncertainty and global economic pressures, adding that the government remained focused on reducing the fiscal deficit, strengthening the current account balance and maintaining macroeconomic stability.

He also stated that Pakistan’s stock market had remained resilient during difficult periods, reflecting investor confidence in the country’s economic direction.

Senator Aurangzeb said SECP had an important role in improving investor awareness, easing investment procedures and introducing regulatory reforms in capital markets.

SECP Chairman Dr Kabir Ahmed Sidhu said investor participation in Pakistan’s capital markets remained below 1% of the population despite recent growth in market activity.

He said the regulator aimed to increase the investor base to 2.5 million over the coming years through structural reforms and investor facilitation measures.

According to Dr Sidhu, onboarding procedures were being simplified while Know Your Customer and Anti-Money Laundering frameworks were being streamlined to improve investor access without weakening regulatory safeguards.

He said limited financial literacy and fragmented investor awareness campaigns remained major barriers to broader retail participation in capital markets.

Officials shared during the ceremony that around 24,000 new investors entered the market in April 2026, while equity markets continued to show positive momentum despite slower activity in the debt capital market.