In a key development, FTSE Russell has lowered Pakistan ranking to frontier market status from secondary emerging.

As per a statement released by FTSE on Wednesday, Pakistan’s market did not meet the minimum securities count requirement necessary to maintain its current status.

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“Further to the ‘FTSE Classification of Equity Markets - FTSE Equity Country Classification Interim Announcement March 2024’ that was published on 27 March 2024, FTSE Russell announces that based on data as of the close on 28 June 2024, Pakistan fails to meet the minimum securities count requirement for retaining secondary emerging market status, as there are less than two eligible Pakistan constituents of the FTSE Emerging Index as of the assessment date.

“Consequently, and in accordance with the FTSE Equity Country Classification framework, Pakistan will be reclassified from secondary emerging to frontier market status in conjunction with the FTSE Global Equity Index Series and the FTSE Frontier Index Series September 2024 index reviews, that are effective from the open on Monday 23 September 2024,” read the notice.

Earlier, FTSE added Pakistan to the watch list from September 2023 for possible reclassification from secondary emerging to frontier market status.

“Over the last few years Pakistan has experienced a steady decrease in its index weight within FTSE Russell global benchmarks, which resulted in the market failing to meet the minimum investable market capitalisation exit level threshold required to retain a secondary emerging market status, based on data as of the close on Friday 30 June 2023, resulting in Pakistan being placed on watch list from September 2023,” FTSE said back then.

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However, back then, Pakistan marginally passed the minimum investable market capitalisation exit level threshold that is required to retain secondary emerging market status.