Pakistan regulator unveils new measures to strengthen Shariah-compliant market intermediaries

This photo taken on July 17, 2018 shows a Pakistani currency dealer counting US dollars banknotes at a currency exchange shop in Karachi. (AFP/File)
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Updated 20 May 2025
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Pakistan regulator unveils new measures to strengthen Shariah-compliant market intermediaries

  • SECP has outlined phased approach encouraging institutional investors to engage with Shariah-compliant brokers
  • Islamic financial institutions being urged to channel takaful, investment activities through specialized intermediaries

KARACHI: The Securities and Exchange Commission of Pakistan (SECP) is proposing new measures aimed at strengthening the presence and operations of Shariah-compliant intermediaries within the capital market, the regulator said in a statement this week.

Pakistan’s Federal Shariat Court (FSC) directed the government in April 2022 to eliminate interest and align the country’s entire banking system with Islamic principles by 2027. Following the order, the government and the State Bank have taken several measures ranging from changing laws to issuing sukuk bonds to replace interest-based treasury bills and investment bonds.

However, documents seen by Arab News earlier this year showed Pakistan’s government had failed to achieve a target set by the central bank to increase the share of Islamic banking deposits in the country by 50 percent by January this year.

“The paper proposes a phase-wise approach for Shariah-compliant institutional investors to route their business through Shariah-compliant brokers based on a plan to be prepared by their respective boards of directors,” the SECP said about the latest proposal. 

“The paper encourages Islamic financial institutions, including providers of Islamic window services, to utilize Shariah-compliant intermediaries for takaful and investment purposes in situations where they are not obligated to do so.”
 
Other proposed measures include creating a specific category for Shariah-compliant intermediaries for greater visibility on the Centralized Gateway Portal and a dedicated list of Shariah-compliant asset management companies on EMLAAK Financials, Pakistan’s first digital mutual fund aggregator. The platform brings together multiple Asset Management Companies (AMCs) and their mutual funds under one roof. It is a venture of ITMinds Limited, a wholly owned subsidiary of the Central Depository Company of Pakistan (CDC).

In order to facilitate Roshan Digital Account (RDA) clients, creating a separate category of Shariah-compliant intermediaries on the websites and mobile apps of Islamic banks would also be explored in coordination with relevant stakeholders, the SECP said.


Pakistan condemns Netanyahu’s ‘hexagon of alliances’ plan, says alert to growing India-Israel defense ties

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Pakistan condemns Netanyahu’s ‘hexagon of alliances’ plan, says alert to growing India-Israel defense ties

  • Israel’s Netanyahu last week proposed an alliance of countries in and around Middle East against its adversaries
  • Pakistan maintains “robust military preparedness” to deter any potential aggression, says foreign office spokesperson

ISLAMABAD: Pakistan’s foreign office spokesperson on Thursday condemned Israeli Prime Minister Benjamin Netanyahu’s recent statement about forming a “hexagon of alliances” within or around the Middle East, saying Islamabad was alert to growing defense ties between New Delhi and Tel Aviv. 

Netanyahu on Sunday outlined plans to form a new regional bloc, describing it as a “hexagon of alliances” that he said could include Israel, India, Greece and Cyprus, along with other unnamed Arab, African and Asian states. He said the grouping would collectively stand against what he described as “radical” adversaries.

His comments came days before Indian Prime Minister Narendra Modi arrived in Israel on Wednesday for a two-day trip to bolster ties. The two are expected to discuss cooperation in science and technology, innovation, agriculture, water management, technology, defense and security during the trip. 

The statement drew a sharp response from Pakistan’s Senate, which unanimously passed a resolution on Tuesday rejecting Netanyahu’s remarks.

“I would also like to draw your attention to the recent resolution adopted by the Senate of Pakistan that strongly condemned such remarks and attempts to undermine Muslim unity,” Foreign Office spokesperson Tahir Andrabi told reporters during a weekly press briefing.

“We continue to condemn these provocative steps and statements by the leadership of the occupying power that threaten regional peace and stability,” he added.

Netanyahu had also said Israel’s goal was to create an axis of nations that see eye to eye against what he described as the “radical Shia” and “radical Sunni” axis of nations. 

Andrabi said attempts to divide the Muslim world along sectarian lines were a “nefarious design” on Netanyahu’s part.

India is Israel’s largest arms buyer and second-largest trading partner in Asia, after China. In response to a question on India’s growing defense ties with Israel, Andrabi said Pakistan remained cognizant of the risks posed by such cooperation.

“Yes, we remain seized of the defense ties between Israel and India,” the spokesperson said, noting that certain “systems and platforms” may have been used by India against Pakistan in the past.

“We are alive to the threats they pose to our security, sovereignty and territorial integrity, as well as to regional peace and stability.”

Andrabi said Pakistan maintained “robust military preparedness” to deter any potential aggression from hostile forces.

‘UTMOST CAUTION EXERCISED’

Andrabi spoke about Pakistan’s recent strikes against alleged militant camps in Afghanistan, saying Islamabad had conducted them in self-defense and with extreme caution to avoid casualties. 

Pakistan said it carried out airstrikes in Afghanistan against militant camps and hideouts in three provinces on Saturday night, killing over 100 militants. Afghanistan accused Pakistan of violating its territorial sovereignty and killing dozens of civilians. Kabul has vowed to retaliate. 

Andrabi said the strikes were carried out to ensure protection for the lives of the people of Pakistan and to prevent “imminent terrorist attacks.”

“These actions were directed solely against identified terrorist camps and hideouts, and utmost caution was exercised to prevent harm to civilians,” he said. 

He warned Pakistan would take necessary measures under its right to self-defense against “terrorist threats” emanating from Afghan territory.

On the safety of Pakistani nationals in Afghanistan following the strikes, Andrabi said Islamabad had raised the issue with Afghan authorities, adding that Islamabad expected “foolproof security” for Pakistani diplomats and civilians.