Pakistan Stock Exchange (PSX), in collaboration with the Ministry of Finance (MoF), hosted an Investor Briefing Session at the Dr. Shamshad Akhtar Auditorium. The session brought together senior representatives of the Ministry of Finance, PSX leadership, asset managers, banks, brokers, and other stakeholders to discuss Pakistan’s debt management strategy, Sukuk issuance, secondary market development, and fiscal reforms. The event featured distinguished guest speakers: Mr. Omer Khan, Advisor on Debt to the Finance Minister, Mr. Khurram Schehzad, Advisor to the Finance Minister, Mr. Khaliq Uz Zaman, Director, Domestic Debt.

Mr. Farrukh H. Sabzwari, Managing Director & CEO – Pakistan Stock Exchange, stated: “PSX continues its journey as a critical institutional partner to the government in debt issuance, with the successful inaugural GOP hybrid Sukuk issuance. The GOP Sukuk issuance in the FY2026 reached PKR 3.5 trillion, nearly double the PKR 2.2 trillion recorded in FY2025. Overall issuance through the Capital Market has now reached PKR 6.4 trillion. Average Daily Traded Volume (ADTV) has risen to PKR 3.9 billion, compared to PKR 2 billion last year. Secondary market participation has expanded significantly, with 11 banks and 3 asset management companies (AMCs) provided direct market access, while 51 Bills & Bonds (BNB) enabled brokers already offer trading in GOP Sukuk. These figures demonstrate the strengthening of Pakistan’s debt market ecosystem.”

Mr. Khurram Shehzad, Advisor to the Finance Minister, remarked: “Pakistan’s budget management approach is built on three pillars: relief, growth, and fiscal responsibility. Exporters have been supported with refinance facilities at 4.5%, compared to market rates of 12%, while small and medium enterprises (SMEs) — which account for 92% of Pakistan’s businesses — have benefited from reductions in super tax. The debt to GDP ratio has improved from 75.2% in 2023 to 68.5% today, and early retirements of expensive debt have totaled PKR 4.7 trillion over the past two years, including PKR 2.2 trillion this year alone. Debt growth has slowed to just 5%, the lowest in 15 years, compared to an average of 12% previously. Debt servicing costs have also improved, with the share of revenue spent on debt falling from 61% to 40%.

Privatization is advancing with three distribution companies scheduled for launch by year-end, alongside strong interest from international investors. Additional privatizations in the energy sector, airports, and banking are in the pipeline. These initiatives, combined with fiscal consolidation and structural reforms, reflect a clear trajectory toward sustainable debt management and a more competitive capital market.”

Mr. Omer Khan, Advisor on Debt to the Finance Minister, stated: “Debt sustainability is the central focus of Pakistan’s strategy. Average Time to Maturity (ATM) has increased from 2.6 years three years ago to 3.9 years today. On the external side, Roshan Digital Account (RDA) inflows have risen by $300 million per month, reflecting stronger from overseas investors. Pakistan has re-entered international capital markets with strategic issuances of Eurobonds and Panda bonds, priced competitively despite global volatility.

Tokenization of sovereign debt is also being launched, making Pakistan one of the few countries globally to attempt this innovation. Liability Management Operations (LMO) peaked at PKR 2,923 billion in FY2026, up 62.7% year on year, including PKR 1,927 billion through State Bank of Pakistan (SBP) instruments. With external debt paydowns totaling $1.8 billion, Pakistan is positioning itself for a more transparent, sustainable, and globally competitive debt profile.”

Mr. Khaliq Uz Zaman, Director – Domestic Debt, stated: “Transparent communication with market participants is central to Pakistan’s debt management strategy. It ensures better participation, stronger price discovery, and ultimately lowers the cost of borrowing for the government. Feedback from investors has been invaluable in shaping new products — whether short term or long term, conventional or Shariah compliant. Over the past two years, every innovation in debt instruments has been the result of this dialogue, and issuance continues to be aligned with the overall portfolio and strategy. Debt policy is not isolated; it works in tandem with credible monetary policy (MP) and fiscal policy (FP), and this credibility has allowed the Debt Management Office (DMO) to build a long-term yield curve and strengthen investor confidence.

FY2026 was a breakthrough year. Gross Sukuk issuance reached PKR 3 trillion, the highest in any fiscal year, delivered through a hybrid structure and supported by a retail push via JazzCash, InvestPak, CDNS, and RDA. ATM was extended to 3.9 years, close to the 4-year target, while Average Time to Refixing (ATR) improved to 1.3 years. Weighted Average Cost (WAC) of borrowing was contained at 11.2%, even below the policy rate, reflecting cost optimization. The yield curve showed tight spreads, with just +19 basis points (bps) between 3 month and 5-year borrowing, allowing the government to lock in medium term funding at near short-term rates. LMO peaked at PKR 2,923 billion, up 62.7% year on year, including PKR 1,927 billion through State Bank of Pakistan (SBP) instruments.”

Secondary market volumes also demonstrated strong momentum. Conventional securities recorded steady growth of +25% year on year, reaching PKR 159,373, while Sukuk trading through PSX surged by +275%, reaching PKR 973. This sharp growth highlights the increasing depth of the Sukuk market, even as volatility remains higher than conventional instruments. Looking ahead, Pakistan’s first short term Sukuk programme — targeting PKR 400–500 billion in 3- and 6-month tenors — will complete the sovereign Sukuk curve, broaden the investor base, and strengthen the savings economy. These achievements reflect resilience, cost efficiency, and a clear trajectory toward a deeper, more liquid, and sustainable domestic debt market.”