KARACHI: A leading Karachi Stock Exchange expert, a former director of the KSE and one time senior official in NIT and ICP, has proposed that the KSE should be quickly sold to a foreign country, as Dubai and Singapore are ready to purchase its controlling shares, if trust and confidence has to return to the Pakistani bourse.
Speaking to The News, Iqbal Ismail, Chairman of a securities firm, said the stock market situation could never be resolved when so many vested and conflicting interests were involved. His comments came as talks between the government, the KSE members, brokers and dealers collapsed despite the intervention of MQM Chief Altaf Hussain on Sunday. The KSE would stay frozen for several more weeks. Ismail has been associated in various capacities with the KSE ever since it was set up after independence, and in his decades of experience he has never been so pessimistic about it.
His conclusion was that unless a foreign partner with a solid reputation and a controlling stake was brought in, manipulation of the KSE by some cronies of sitting government would continue and small investors would always suffer.
Ismail said the government was committed to de-mutualisation of the stock exchange, which would mean cutting down the role of KSE members to one third. The rest of the two thirds shares should be sold to the Dubai Stock Exchange or Singapore or New Zealand, as these countries had expressed their interest to be part of the Pakistani exchange.
He said the KSE should be turned into a private company and its shares be sold to the highest bidder who can then impose a discipline that would generate confidence and trust, and investors from worldwide would come to Pakistan.
“In the present situation, Pakistan lacks trust and the government can do nothing about it. So let us invite the Dubai Stock Exchange to run the KSE,” Ismail said. The old man of the KSE has seen the 2005 KSE scandal and the first scam in 2000 in which some bigwigs made billions at the cost of small and poor investors.
“It was in 2000 that these sharks tasted blood and they never stopped. Today, these big five or big seven have brought the KSE to a point where it has collapsed and small investors have already died. They need to be buried decently.”
Source: The News, 27/10/2008