Bambang highlighted the fast-growing issuance of Indonesia’s sovereign sukuk (Sukuk Negara). Indonesia, which has the world’s largest Muslim population, is the largest sukuk issuer in terms of both total issuance and outstanding sukuk.

"As of May 10, total issuance of Sukuk Negara reached Rp 503 trillion or around $38 billion, with total outstanding sukuk at Rp 380 trillion or around $29 billion. Outstanding sukuk accounts for 15 percent of total government securities," he said in remarks at the annual Islamic Finance Conference of the Islamic Development Bank (IDB) on Tuesday in Jakarta.

Since its debut, total issuance of lndonesia’s sovereign sukuk in dollar denomination has reached $10.15 billion, with current outstanding sukuk at $9.5 billion. The market responded positively to the instrument, Bambang father said.

“Our latest dollar sukuk, issued in March, received a very good response from investors. For the $2.5 billion issuance, total subscription reached $8.6 billion or around 3.5 times," he added.

To accelerate the development, Indonesia has focused on the issuance of sukuk to finance infrastructure projects since 2012. It became the new source of project financing that provided certainty and assurances on the utilization of sukuk proceeds.

At the early stages, Indonesia issued only ljara, Musharaka and Mudaraba sukuk. Today, various types of sukuk have been developed into murabaha, salam, wakala and other types of sukuk such as hybrid sukuk, exchangeable sukuk, green sukuk, perpetual sukuk and voucher sukuk.

According to the 2015-2019 Mid-Term Development Plan (RPJMN), funding needs for infrastructure projects is more than $5 quadrillion, with almost 45 percent to be covered by the government. (ags)

Popular

Great Barrier Reef hit by record bleaching

Govt to undo latest curbs on personal imports

Middle East on edge as Israel and Iran trade threats