Pakistan has begun work on a National Private Equity Policy Framework aimed at attracting more domestic and international long-term capital into Pakistani businesses and growth sectors.

Finance Minister Muhammad Aurangzeb chaired the first meeting of the committee formed by the Prime Minister to prepare the policy framework.

The committee discussed how private equity can provide growth capital to businesses, help companies expand and scale up, improve productivity and strengthen their competitiveness.

It also examined the potential use of private equity for mergers and acquisitions, business restructuring, privatization and other long-term investment opportunities.

A key focus was creating a pipeline of bankable business plans and investable projects that can give investors clearer opportunities and make it easier to deploy long-term capital in Pakistan.

The committee also reviewed taxation and regulatory barriers that may discourage private equity investment. It discussed providing greater flexibility for private equity funds and creating appropriate tax treatment to support long-term investment and reinvestment.

Aurangzeb said the framework should be led by the private sector, with the government focusing on regulatory clarity, an enabling business environment and removal of policy and tax hurdles.

The government does not plan to provide direct funding under the initiative. Instead, the policy is designed to encourage domestic and foreign investors to bring more long-term capital into Pakistan.

The committee has formed four workstreams covering taxation, regulatory reforms, business strategy and identification of bankable projects.

Their recommendations will be consolidated into the National Private Equity Policy Framework and presented to the Prime Minister for consideration.