The Securities and Exchange Commission of Pakistan (SECP) has issued concept papers to stimulate the growth of the short-term listed sukuk market in the country. The papers aim to gather public feedback and explore potential regulatory changes to encourage the issuance and listing of both sovereign and corporate short-term sukuks.
Pakistan’s capital market has witnessed a surge in the issuance of sovereign Ijara sukuk instruments, totaling approximately Rs. 713 billion since December 2023. However, the market for short-term sukuks with maturities of 3, 6, or 9 months remains underdeveloped.
SECP recognizes the growing popularity of short-term sukuks among investors and aims to create a more conducive environment for issuers to offer these instruments in the listed market. The concept papers propose various measures to streamline the listing process, reduce regulatory burdens, and enhance efficiency for both issuers and investors.
By promoting the development of the short-term sukuk market, SECP seeks to support the Federal Shariat Court’s ruling for the creation of a RIBA-free economy. Short-term sukuks offer a viable and attractive financing option for businesses and individuals alike.