Pakistan’s Federal Minister for Finance and Revenue, Senator Muhammad Aurangzeb, has underscored the critical role of tax reform in strengthening the country’s capital markets. Speaking at the inaugural meeting of the Capital Market Development Council (CMDC) in Islamabad, the minister stressed that a modern, transparent, and investor-friendly capital market is essential for sustainable economic growth and enhanced access to finance.
The CMDC meeting brought together key stakeholders, including representatives from the Tax Policy Office, State Bank of Pakistan (SBP), Securities and Exchange Commission of Pakistan (SECP), Debt Management Office (DMO), and the Finance Division. The council also included senior officials from the Pakistan Banks Association, Pakistan Stock Exchange, Central Depository Company, National Clearing Company, and Pakistan Business Council. The collaborative forum aims to create a roadmap for developing a more vibrant and inclusive capital market ecosystem.
Addressing participants, Finance Minister Aurangzeb highlighted that taxation remains a decisive factor influencing market attractiveness. He emphasized the need for reforms that incentivize compliant and transparent companies rather than imposing punitive measures. “Tax policies should reward companies that maintain high transparency and governance standards while facilitating the development of new investment products and promoting market competitiveness,” he said.
The discussions at the inaugural meeting focused on multiple dimensions of market development. Key topics included enhancing retail and institutional investor participation, expanding product offerings in both debt and equity markets, improving facilitation for intermediaries, and creating incentives for companies to raise funds through formal capital market channels. Cross-border integration, regulatory modernization, and global best practices were also emphasized as priorities to ensure that Pakistan’s capital markets are aligned with international standards.
Aurangzeb stressed that a well-functioning capital market ecosystem is a national priority, not only for providing businesses with access to capital but also for promoting savings, deepening market liquidity, and strengthening the long-term resilience of Pakistan’s economy. He highlighted ongoing structural reforms as pivotal to improving market performance and urged the public and private sectors to actively leverage the debt and equity capital markets for sustainable growth.
To operationalize the council’s objectives, dedicated working groups were tasked with preparing key performance indicators and actionable plans within a two-week timeframe. Quarterly progress reports will monitor implementation, ensuring that the strategies translate into measurable improvements in market activity, transparency, and investor engagement.
The Finance Minister’s remarks signal a strategic shift in Pakistan’s approach to capital market development, focusing on a coordinated policy framework, tax incentives, and investor-friendly reforms to drive growth. By aligning taxation policies with market development goals, the government aims to attract greater domestic and foreign investment, enhance corporate participation, and support a more competitive financial ecosystem.
This inaugural CMDC meeting reflects Pakistan’s commitment to strengthening the capital markets through thoughtful policy interventions, innovative product development, and collaboration between regulatory authorities, financial institutions, and industry stakeholders. The council is poised to play a central role in creating an integrated, efficient, and resilient capital market landscape.
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