"We should be ahead of curve of technology," he remarked during his visit to the Karachi Stock Exchange where he held a detailed meeting with the officials and Chairman of the Exchange Arif Habib.
He said that the KSE is an important national institution and playing its role and added that since he took up the office of the Governor SBP, the equity market has become more transparent, better disclosures, better risk management measures, exposure limits as per international standards and T+3 system was introduced.
The government has fulfilled its commitment by introducing positive investment policies as well as privatisation of public entities. He added that the national commodity exchange is an important institution to provide futures market in commodities and, "I look forward for its early operation." He pointed out that the Pakistan's financial sector looks to be a closed shop for an elite class and needs to be opened for small and middle class investors.
He said the funds of over Rs 900 billion which were invested in the National Savings Scheme can now be directed to the equity market due to reduction in the rates of profits as well as restriction on large corporate investors to invest their funds in these schemes.
He said that this conduit is now closed and there are new openings for investors in the mutual fund industry, provident fund and pension fund and there is a need to attract these funds. "We should think for future," he suggested. The market research is a key area and it should not be restricted to few brokerage houses, he said. He also called upon the stock exchanges and other institutions to promote this activity in their respective spheres.
The SBP Governor while appreciating various efforts being made for the listing of new companies said that he fully supports that the listed companies should be allowed some tax incentives especially in view of the corporate governance and he will continue to support this policy at all government's level.
Similarly, he said that the OTC market is the need but at the same time the listings on this market should be cost effective with bear minimum listing requirements and it should be open for all companies.
With regard to the investors' education, he said that this is an important area and need to be provided through some institutional arrangements by way of creating a subsidiary company of stock exchanges.
Referring to monetary policy statement for current half year about movement in interest rates and exchange rates, he said that the people are over reacting. These movements are normal in the context of higher growth rates and there should be no concern whatsoever.
The Governor SBP said that we would have high growth rate, which is sustainable for a long-time. He pointed out that unemployment is major problem of the country and the KSE can play a major role in overcoming this problem by bringing more companies listed. The KSE should workout a market strategy to channalise large funds available with leading institutions like OGDC, PTCL and Steel Mills.