The Securities and Exchange Commission of Pakistan has constituted a high level Working Group to conduct a comprehensive review of Pakistan’s corporate debt market and recommend reforms aimed at making the market more efficient, accessible and cost effective. The initiative is focused on addressing longstanding concerns raised by market participants regarding lengthy issuance timelines and high costs associated with corporate debt instruments issued through private placements and public offerings. According to an official notification issued by the Securities Market Division’s Policy, Regulation and Development Department on July 30, 2026, the Working Group will examine the existing regulatory framework, identify obstacles affecting market development and recommend practical measures to make corporate debt issuance faster and simpler. The review will cover both conventional corporate debt securities and Sukuk, with the broader objective of increasing market participation and improving the ability of companies to access long term financing through Pakistan’s capital markets.
A significant part of the Working Group’s mandate will involve reviewing the existing credit rating framework and assessing its impact on the corporate debt market. The group will examine whether current credit rating requirements contribute to unnecessary delays, additional costs or restrictions on market accessibility, while also considering measures that could improve transparency and investor confidence. It will evaluate the overall efficiency of the rating process and explore reforms that could simplify requirements while allowing greater scope for innovation in rating products. The Working Group will also undertake an end to end assessment of the issuance process for privately placed and publicly offered corporate debt securities. This review will examine the time taken at individual stages of an issuance, identify regulatory, legal and operational bottlenecks and assess the complete cost structure. The cost assessment will include regulatory fees, professional charges, listing expenses, taxation and other transaction related costs, with recommendations expected on how these expenses can be rationalized to make corporate debt issuance more attractive for companies and investors.
The Working Group will also examine the legal, regulatory and documentation requirements governing corporate debt transactions. Where necessary, it will consider the preparation of standardized documentation that could reduce repetitive work and improve consistency across different debt offerings. The group is expected to recommend amendments to the regulatory framework where changes are required to improve the efficiency and speed of the issuance process. Taxation will also form part of the review, with the Working Group assessing the existing tax treatment of corporate debt instruments and identifying measures that could reduce tax related impediments and improve the attractiveness of the market. In carrying out its work, the group will consult relevant market participants to obtain practical feedback from institutions directly involved in debt issuance, investment, trading, settlement and regulation. It will also benchmark Pakistan’s corporate debt framework against international best practices to identify areas where domestic rules and market practices can be improved.
Islamic corporate debt will receive separate attention under the reform exercise, with the Working Group tasked with reviewing the regulatory and Shariah framework governing Sukuk issuance. The group will identify Shariah, legal and operational issues that contribute to higher transaction costs or longer issuance timelines and recommend reforms designed to improve the efficiency of the Islamic debt market. Standardized Sukuk structures will also be considered as part of the review, with the aim of reducing complexity and facilitating more efficient issuance. The development of a deeper Islamic corporate debt market could provide companies with an additional source of long term financing while expanding investment opportunities for institutions and other market participants seeking Shariah compliant instruments. The review therefore covers both the conventional and Islamic segments of Pakistan’s corporate debt market and seeks to address structural issues that may be limiting their growth.
The Working Group will be chaired by SECP Commissioner Muhammad Ali Farid Khwaja and includes senior representatives from major capital market institutions, financial sector organizations, legal advisers and government bodies. 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. The group also includes 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 necessary to support its work.
The Working Group has been given 45 days from the date of its constitution to submit its report, placing a defined timeline on the reform exercise. The review comes as Pakistan seeks to strengthen its domestic capital markets and create additional channels through which businesses can secure long term financing. A more efficient corporate debt market could provide companies with alternatives to bank borrowing while potentially increasing the range of investment products available to institutional and other investors. Reducing issuance costs and shortening approval and documentation timelines could also make debt market financing more practical for a wider group of companies, particularly those seeking structured funding through bonds or Sukuk.
SECP Chairman Dr. Kabir Ahmed Sidhu said that the development and stability of the corporate debt market remains a key priority for the regulator. He emphasized the importance of a robust debt market in providing long term capital to industry and the government. The Working Group’s review is therefore expected to address not only individual procedural issues but also broader structural factors affecting the depth and stability of Pakistan’s debt market. Its recommendations could influence the regulatory framework for corporate bonds and Sukuk, the credit rating process, taxation, documentation, issuance costs and market participation.
The formation of the Working Group represents a formal effort by the Securities and Exchange Commission of Pakistan to bring together regulators, market operators, financial institutions, advisers and government representatives to examine the practical challenges facing corporate debt issuance. With its 45 day reporting deadline, the group is expected to produce recommendations focused on measurable improvements to issuance efficiency, cost reduction and market accessibility. If implemented, the proposed reforms could support a broader corporate debt market, strengthen long term financing options for businesses and contribute to the development of Pakistan’s wider capital market infrastructure.
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