Private equity ecosystem: Govt has moved to unlock capital flows, says finance minister

Islamabad, 2026 - The federal government in Pakistan has taken steps to unlock more long-term capital for its private equity ecosystem, according to Finance Minister Muhammad Aurangzeb. The minister chaired the inaugural meeting of the committee established by the Prime Minister to create a framework that would streamline regulatory and tax obstacles and generate investment prospects.

The committee's discussion centered on the vital role private equity plays in fostering long-term investment, capital growth, and sustainable economic expansion. Aurangzeb stressed that the policy framework should be driven by the private sector, with the government's role being to create an enabling environment and provide regulatory clarity.

The objective is not to supply direct government funding but to encourage more participation from both domestic and international investors. The committee reviewed the current private equity landscape and debated measures to establish a supportive taxation and regulatory framework. This includes treating private equity funds as investment vehicles and offering higher flexibility for long-term investment and reinvestment.

The committee also explored the potential of private equity in backing mergers, acquisitions, restructuring, privatization, and other long-term investment opportunities. They agreed to form four work streams to develop focused recommendations on taxation, regulatory framework, business strategy, and identification of bankable business plans.

These recommendations will be compiled into a National Private Equity Policy Framework and presented to the Prime Minister for review. Aurangzeb stressed the requirement for specific, practical, and workable recommendations to unlock long-term capital, promote private-sector investment, and contribute to sustainable, inclusive economic growth.