Collaboration aims to expand Shariah-compliant investments and strengthen economic ties.
Key Takeaways:
* Pakistan and Malaysia are collaborating to strengthen ties in Islamic finance.
* The Pakistan Stock Exchange (PSX) and Malaysian Shariah scholars are exploring ways to boost Shariah-compliant investments.
* Pakistan aims to leverage Malaysia’s expertise to expand its investor base in Islamic finance.
Islamabad, Pakistan – April 19, 2025 – Pakistan and Malaysia are deepening their collaboration to strengthen Islamic finance and expand Shariah-compliant capital markets. A delegation of Malaysian Shariah scholars recently visited the Pakistan Stock Exchange (PSX) to discuss avenues for cooperation and growth in faith-based investments.
PSX Chairperson Dr. Shamshad Akhtar expressed optimism about the growing relationship, highlighting Pakistan’s increasing demand for Shariah-compliant investment options. She noted that over 50% of the companies listed on the PSX adhere to Shariah principles, offering a strong platform for Islamic investments, including Sukuk (Islamic bonds) and Islamic mutual funds.
Currently, only 0.14% of the population participates in the capital market, significantly lower than the 1% in Bangladesh.
Tariq Naseem, Head of Islamic Finance at the Securities and Exchange Commission of Pakistan (SECP), briefed the delegation on Pakistan’s progress in Islamic finance, including regulatory reforms and the expansion of Islamic financial services. He also emphasized the potential for collaboration with Malaysia to promote Islamic finance globally.
PSX Managing Director Farrukh H. Sabzwari pointed out the untapped potential within Pakistan’s investor base. Currently, only 0.14% of the population participates in the capital market, significantly lower than the 1% in Bangladesh. He expressed his intention to utilize Malaysia’s expertise in Islamic finance to develop Pakistan’s capital market and increase investor participation.
Malaysia is a leading hub for Islamic finance, with a well-developed Islamic financial system and a robust regulatory framework. This collaboration seeks to leverage Malaysia’s experience to further strengthen Pakistan’s Islamic finance sector and attract more investors to its capital markets.
