ISLAMABAD - Pakistan Mercantile Exchange Limited (PMEX) and the International Finance Corporation (IFC) have signed a Cooperation Agreement to bolster Pakistan’s agricultural commodities futures market and support the implementation of the Electronic Warehouse Receipt (EWR) system.
Enhancing Transparency and Efficiency
The partnership is designed to improve transparency, efficiency, and private sector involvement in commodity markets. By strengthening price discovery and risk management tools, the initiative will assist farmers, traders, processors, and investors in making well-informed business decisions. It is also expected to encourage investment in warehousing infrastructure, cut post-harvest losses, and enhance food security in Pakistan. Maize, rice, cotton, and wheat have been prioritized for futures trading on the PMEX platform.
Regulatory Reforms and Capacity Building
Under the agreement, IFC will support a review of the existing regulatory framework governing the storage, transportation, and trading of agricultural commodities and recommend reforms to improve the enabling environment. IFC will also facilitate stakeholder engagement, assist in developing futures contracts, and lead awareness and capacity-building initiatives to promote futures trading and wider adoption of electronic warehouse receipts.
Khurram Zafar, Chief Executive Officer of PMEX, stated: “This partnership with IFC marks an important step towards modernizing Pakistan’s agricultural markets. Efficient commodity futures markets and electronic warehouse receipts can improve price transparency, strengthen risk management, encourage investment in storage infrastructure, and provide farmers, traders, processors, and investors with better market access. Together, we aim to create a stronger and more resilient agricultural marketing ecosystem for Pakistan.”
Alignment with Global Initiatives
The partnership aligns with the World Bank Group’s Agri Connect Global initiative, which supports governments and key public and private sector stakeholders in strengthening agricultural value chains, promoting climate-smart production, and improving market access for farmers. In Pakistan, the program focuses on promoting modern storage systems, enhancing price transparency, and connecting farmers to competitive markets.
Simon Andrews, IFC Director for Pakistan, commented: “A modern, efficient commodities market is essential for unlocking Pakistan’s agricultural potential. By strengthening price discovery, expanding private sector warehousing, and promoting electronic warehouse receipts, we can help farmers secure better returns, reduce losses, and access finance. This is a critical step towards building a more resilient and market-driven agri-food sector.”
Government Support and Future Plans
Ahmed Umair, Coordinator to the Prime Minister on Agriculture and Food Security, noted: “The government has launched the Agriculture Innovation and Growth Program (AIGP) for the capacity building of farmers. The federal government is also working on reforms to modernize the agriculture sector regulatory framework and is in the process of finalizing the national Wheat Policy, which will be a giant leap for the agriculture sector as a whole.”
The signing ceremony was attended by members of the Board of Directors of PMEX, Additional Secretary of the Ministry of National Food Security and Research, Director of the Commodities Regulation & Development Department of the Securities and Exchange Commission of Pakistan, as well as representatives from the World Bank Group.
