Pakistan capital market adopts one-day settlement of transactions ahead of EU, UK markets

A stockbroker walks past share prices on a financial market board during a trading session at the Pakistan Stock Exchange (PSX) in Karachi on April 9, 2025. (AFP/File)
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Updated 10 February 2026
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Pakistan capital market adopts one-day settlement of transactions ahead of EU, UK markets

  • Effective from Feb. 9, all trades at Pakistan stock market are now settled on a one-business-day basis
  • The reform aims to reduce risk and improve capital efficiency in the exchange of funds and securities

KARACHI: Pakistan's capital market has officially transitioned to the Trade plus one (T+1) settlement cycle that essentially requires securities transactions to be finalized within one business day after the trade date, the Pakistan Stock Exchange (PSX) said on Tuesday.

The new settlement cycle, which reduces counterparty risk and improves capital efficiency in the exchange of funds and securities, aims to align the Pakistani capital market with international best practices.

Effective from Feb. 9, all eligible trades at the PSX are now settled on a T+1 basis, replacing the previous T+2 cycle. The transition was implemented under the guidance of the Securities and Exchange Commission of Pakistan (SECP) through close collaboration among all stakeholders, according to the PSX.

It aligns Pakistan’s capital market with leading markets such as the United States, Canada, Mexico, Argentina, Jamaica and China, which have already adopted shorter settlement cycles. Europe, the UK and Switzerland are set to follow by 2027.

"The transition to the T+1 settlement cycle brings important advantages for Pakistan’s capital market. It enables faster access to funds and securities, improving liquidity, while reducing settlement and counterparty risk through shorter exposure periods," the PSX said.

"Quicker trade finalization enhances efficiency and the reform strengthens investor confidence, particularly among institutional and foreign investors. Together, these benefits support a stronger and more resilient market aligned with global best practices."

Pakistan’s stock market has touched historic highs in recent months as broad institutional buying boosted investor confidence amid ongoing economic reforms under international lending programs. Pakistani state media reported in Jan. around 135,000 new investors had joined the PSX over the last 18 months.

SECP Chairman Dr. Kabir Ahmed Sidhu commended the PSX, the Central Depository Company and the National Clearing Company of Pakistan for the successful implementation of the T+1 settlement system.

"The reform brings Pakistan’s capital market at par with modern jurisdictions by accelerating trade settlement, reducing counterparty and market risks, and enhancing liquidity," he was quoted as saying by the PSX.

"The adoption of T+1 will strengthen investor confidence and align Pakistan’s capital market with evolving international standards and global best practices."


Pakistan’s Afghan salvo risks turning ‘open war’ into long crisis

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Pakistan’s Afghan salvo risks turning ‘open war’ into long crisis

  • Nuclear-armed Pakistan has a formidable military of 660,000 active personnel, backed by a fleet of 465 combat aircraft
  • But the Taliban have the option to lean on insurgent groups like the TTP and the BLA to move beyond border skirmishes

KARACHI: Weeks after the Taliban’s lightning offensive in 2021 wrested control of Afghanistan from a US-led military coalition, Pakistan’s then intelligence chief flew into the capital Kabul for talks, where the serving lieutenant general told a reporter: “Don’t worry, everything will be okay.”

Five years on, Islamabad — long seen as a patron of the Taliban — is locked in its heaviest fighting with the group, which Pakistan’s Defense Minister Khawaja Muhammad Asif described on Friday (February 27) as an “open war.”

The turmoil means that a wide swathe of Asia — from the Gulf to the Himalayas — is now in flux, with the United States building up a military deployment against Afghanistan’s neighbor Iran even as relations between Pakistan and arch rival India remain on edge after four days of fighting last May.

At the heart of the conflict with Afghanistan is Pakistan’s accusation that the Afghan Taliban provides support to militant groups, including the Tehreek-e-Taliban Pakistan (TTP), that have wreaked havoc across inside the South Asian country.

The Afghan Taliban, which has previously fought alongside the TTP, denies the charge, insisting that Pakistan’s security situation is its internal problem.

The disagreement is a reflection of starkly incompatible positions taken by both sides, as Pakistan expected compliance after decades of support to the Taliban, which did not see itself beholden to Islamabad, analysts said.

“We all know that the government in Pakistan supported the Taliban, the Afghan Taliban for many years, in the 90s and the 2000s, and provided havens to them during the period where the US and NATO were in Afghanistan.

So there’s a very close relationship between the Taliban and Pakistan,” said Jennifer Brick Murtazashvili, a political scientist at the University of Pittsburgh and an Afghanistan expert.

“It’s really surprising and shocking to many of us to see how quickly this relationship deteriorated,” she said.

Although tensions have simmered along their rugged 2,600-km (1,615-mile) frontier for months, following clashes last October, Friday’s fighting is notable because of Pakistan’s use of warplanes to hit Taliban military installations instead of confining the attacks to the militants it allegedly harbors.

These include targets deep inside the country in Kabul, as well as the southern city of Kandahar, the seat of Taliban supreme leader Hibatullah Akhundzada, according to Pakistan military spokesman Lt. Gen. Ahmed Sharif Chaudhry.

The clashes are unlikely to end there.

“I think in the immediate aftermath, I think hostilities will subside. There will be, I hope there will be a ceasefire through mediation. But I do not see these tensions subsiding in the foreseeable future,” said Abdul Basit,  an expert on militancy and violent extremism at Singapore’s S. Rajaratnam School of International Studies.

Nuclear-armed Pakistan has a formidable military of 660,000 active personnel, backed by a fleet of 465 combat aircraft, several thousand armored fighting vehicles and artillery pieces.

Across the border, the Afghan Taliban has only around 172,000 active military personnel, a smattering of armored vehicles and no real air force.

But the battle-hardened group, which took on a phalanx of Western military powers in 2001 and outlasted them, has the option to lean on insurgents like the TTP and the Baloch Liberation Army (BLA), moving beyond border skirmishes.

Based in Pakistan’s largest and poorest province of Balochistan that borders both Iran and Afghanistan, the BLA has been at the center of a decades-long insurgency, which in recent years has staged large coordinated attacks.

Pakistan has long accused India of backing the insurgents, a charge repeatedly denied by New Delhi, which has retained a robust military deployment along the border since last May.

Although a raft of countries with influence — including China, Russia, Turkiye and Qatar — have indicated an openness to help mediate the conflict, all such efforts have been met with limited success so far.