IsDB assists Uzbekistan in developing green sukuk regulatory framework

The Islamic Development Bank (IsDB) is working with the government of Uzbekistan to draft legislation and establish a regulatory framework for green sukuk (Islamic bond), said Yahya Rehman, Lead Islamic Finance Specialist at IsDB, according to Report's correspondent in Almaty.

He made the announcement during the Eurasian Development Bank's annual meeting and business forum at the session titled "Technical Assistance as a Catalyst for Investment: MBDs' Perspective."

Rehman explained that IsDB's technical assistance model in Islamic finance involves cooperation not only with governments but also with other multilateral development banks. "In Uzbekistan, we are working with the UN Development Programme, which has alternative financing mechanisms. We also cooperate with the Asian Development Bank and other multilateral institutions in developing the sukuk market. At present, we are supporting the Uzbek government in preparing legislation and the necessary regulatory framework for green sukuk," he said.

He noted that IsDB is also implementing a technical assistance project in Azerbaijan to support capital market development. In Uzbekistan, earlier technical assistance contributed to the adoption of legislation on retail Islamic banking. Similar initiatives have been successfully carried out in Tajikistan and other countries in the region.

Rehman emphasized that IsDB"s technical assistance acts as a catalyst for the development of Islamic finance markets. "When investors and financial institutions enter a new market, they need clear rules and a favorable regulatory environment. They must be confident that legislation is already in place. That is why we first help establish the necessary legal framework, after which the private sector, international financial institutions, and government bodies can invest with confidence and develop Islamic finance institutions," he added.