The Securities and Exchange Commission of Pakistan (SECP) has constituted a high-level Working Group to conduct a comprehensive review of the country’s corporate debt market and recommend practical reforms aimed at improving market efficiency, reducing issuance timelines and lowering the costs associated with corporate debt instruments. The initiative is also intended to broaden participation in the corporate debt market and address regulatory, operational, legal and taxation-related barriers affecting its development.
According to an official notification issued by the Securities Market Division’s Policy, Regulation and Development Department on July 30, 2026, the formation of the Working Group follows feedback from market participants regarding challenges in the existing corporate debt issuance process. Market participants have identified lengthy timelines and high issuance costs for corporate debt instruments issued through private placements and public offerings as major obstacles limiting the growth and accessibility of Pakistan’s corporate debt market. The Working Group will review the existing regulatory framework governing corporate debt securities and Sukuk and identify bottlenecks that are affecting market development. It will be responsible for developing practical recommendations to make the issuance process faster, simpler and more cost-effective for companies and other market participants.
A significant part of the group’s mandate will focus on the existing credit rating framework. The Working Group will assess measures that could improve the efficiency and transparency of the rating process while strengthening market confidence. It will also examine the impact of current credit rating requirements on issuance timelines, transaction costs and accessibility for issuers and investors. Based on its assessment, the group will recommend reforms aimed at simplifying the rating process and facilitating greater innovation in rating products. The Working Group will also conduct an end-to-end review of the issuance process for both privately placed and publicly offered corporate debt securities. This review will examine the amount of time required at each stage of an issuance and identify regulatory, legal and operational bottlenecks that may be delaying transactions.
In addition to timelines, the group will assess the complete cost structure associated with corporate debt issuance. This will include regulatory fees, professional charges, listing expenses, taxation and other transaction-related costs. The Working Group will consider measures to rationalize these expenses and make corporate debt issuance more financially viable for businesses seeking alternative sources of funding. The group will further review legal, regulatory and documentation requirements applicable to corporate debt transactions. Where necessary, it will consider the development of standardized documentation and recommend amendments to the existing regulatory framework to improve the overall efficiency of the issuance process.
Taxation will also form part of the review. The Working Group will assess the tax framework applicable to corporate debt instruments and recommend measures to reduce tax-related impediments and improve the attractiveness of the market. The group will consult relevant market participants during the process and benchmark Pakistan’s corporate debt framework against international best practices.
The development of the Islamic debt market is another key area covered by the Working Group’s mandate. It will review the regulatory and Shariah framework governing Sukuk issuances and identify Shariah, legal and operational factors that contribute to higher costs or longer issuance timelines. The group will recommend reforms that could support standardized Sukuk structures, improve market efficiency and expand Pakistan’s Islamic corporate debt market.
The Working Group will be chaired by SECP Commissioner Muhammad Ali Farid Khwaja. Its members include Farrukh H. Sabzwari, Chief Executive Officer of Pakistan Stock Exchange Limited; Maheen Rehman, Chief Executive Officer of InfraZamin Pakistan; Salman Ali Jafri; Syeda Sharmeen Ahmed, Managing Director Corporate Finance at Topline Securities; Muhammad Farid Alam, Chief Executive Officer of AKD Securities Limited; and a representative of Askari Bank Limited. Other members include Badiuddin Akbar, Chief Executive Officer of Central Depository Company; a representative of PACRA Credit Rating Agency; a representative of Mohsin Tayebaly & Co.; Muhammad Khaliq-uz-Zaman from the Debt Management Office of the Ministry of Finance; and Imran Inayat Butt, Executive Director at SECP, who will serve as coordinator.
The notification allows the Working Group to co-opt additional experts or institutions where required to support its work. The group is required to submit its report within 45 days of its constitution, giving it a defined timeframe to complete its review and present recommendations for reform. SECP Chairman Dr. Kabir Ahmed Sidhu said the development and stability of the corporate debt market is a key priority. He noted that a robust corporate debt market can provide long-term capital for industry as well as the government.
The initiative places emphasis on addressing structural barriers that have limited the expansion of corporate debt financing in Pakistan. By reviewing issuance procedures, credit rating requirements, documentation, taxation, regulatory costs and Sukuk structures together, the Working Group is expected to develop recommendations covering multiple stages of the corporate debt market. If implemented, the proposed reforms could provide issuers with a more efficient route to raising long-term capital while supporting wider participation in Pakistan’s debt market. The review also provides an opportunity to align the country’s corporate debt framework more closely with international practices and improve the overall functioning of both conventional corporate debt and Islamic debt markets.
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