What Happened : According to a report published by the Pakistan Institute of Development Economics (PIDE), the number of wealthy families controlling Pakistan’s economy and politics has jumped to 31 from 22 since independence. These families also dominate Pakistan’s stock market. The report was written by Nadeem Ul Haque, Vice-Chancellor, PIDE, and Amin Husain, Doktorand, Uppsala University.
31 families control KSE-100
There are 31 families in Pakistan dominating Pakistan’s stock market, indicating the number of influential and wealthy families had gone up from 22 to 31 since the country’s independence.https://t.co/CrnogkZG9A— A Nasir Khwaja (@ANasirKhwaja) May 5, 2021
What Else: The report also revealed that most companies listed on the KSE-100 index are connected to each other through directorships. Only a very few (at the most 15) do not share common directorships with other companies in the index. It was also illustrated that directors or significant shareholders control the ownership of more than PKR 4.963 trillion, or approximately 73 percent, of the total market cap of PKR 6.8 trillion, resulting in minority stakeholders only possessing an average of 25 percent shares in each KSE-100 firm. The Impact: The concentration of economic power allows a small number of individuals to dictate the network formation paradigm: this nucleus is most likely to control the hiring process; exercise political power derived from positions they previously held as elected representatives, bureaucrats, or military personnel; or provide insights into the operations of key accountability and governance mechanisms.