Chinese consortium plans wider role in Pakistan’s capital market infrastructure

Chinese strategic shareholders of the Pakistan Stock Exchange have said they plan to expand their investment in Pakistan’s capital market infrastructure after receiving regulatory approvals from the Securities and Exchange Commission of Pakistan.

The plan was conveyed during a meeting between SECP Chairman Dr Kabir Ahmed Sidhu and a delegation representing the Chinese consortium, which includes the China Financial Futures Exchange, Shanghai Stock Exchange and Shenzhen Stock Exchange.

Officials said the approvals would allow the consortium to increase its shareholding in the Central Depository Company and the National Clearing Company of Pakistan Limited, two key institutions in Pakistan’s post-trade market infrastructure.

The meeting also covered cooperation on new financial products, including proposed cross-border exchange-traded funds that would give investors in Pakistan and China access to each other’s markets. Officials said a joint task force comprising representatives from stock exchanges in both countries had been formed to work on the initiative.

Discussions also covered trading and settlement technology, market surveillance, liquidity improvement, investor awareness and capacity-building.

The Chinese consortium acquired a 40 percent strategic stake in PSX in 2016–17. The consortium comprises CFFEX, Shanghai Stock Exchange, Shenzhen Stock Exchange, Pak China Investment Company and Habib Bank Limited.