Capital market development termed vital for growth

SECP aims to expand investor base to 2.5m through greater financial inclusion

ISLAMABAD:

A developed capital market is indispensable for sustainable economic growth, veteran businessman Arif Habib said at the SECP Talk Series, where he shared insights from over five decades of association with Pakistan's capital markets.

The session, attended by Securities and Exchange Commission of Pakistan (SECP) Chairman Dr Kabir Ahmed Sidhu, commissioners, representatives of market institutions, academia and business leaders, explored the evolution of Pakistan's capital markets, long-term investment and the reforms needed to deepen investor participation.

Opening the session, Sidhu said the Talk Series was aimed at institutionalising knowledge sharing by connecting regulators with experienced market practitioners to support evidence-based policymaking. He highlighted the SECP's ongoing reforms, including digital investor onboarding, implementation of the T+1 settlement cycle and initiatives to expand the investor base to 2.5 million through greater financial inclusion and easier market access. "Our objective is to build a capital market ecosystem that is transparent, accessible and aligned with global standards," he said.

Sharing his thoughts, Arif Habib traced Pakistan's capital market journey from open-outcry trading floors to today's technology-driven marketplace. He emphasised that while markets evolved, the principles of successful investment comprised discipline, patience and long-term thinking.

Habib noted that the Pakistan Stock Exchange delivered an average annual return of around 22% over the past 22 years and a 14% dollar-denominated return over the last five years. He stressed that market volatility was temporary, while long-term investment in fundamentally strong companies would create sustainable wealth.

He underscored the role of capital markets in mobilising savings, financing businesses, strengthening corporate governance and creating employment across brokerage, asset management, investment banking, research, fintech and advisory services. He emphasised the need to increase financial literacy, particularly among young Pakistanis, to broaden participation in formal capital markets.