With special interest of His Excellency President Ashra Ghani and under leadership of Eklil Hakimi and with kind support of Islamic Development Bank and World Bank Afghanistan will soon launch Sukuk for the first time.
A team under Dr.Alam Khan Hamdard Ahmadzai starts working on initial stages of Sukuk. Afghanistan is in lack of Sukuk and this is first time that Sukuk will be launched in country and will be a revolution in modern Afghanistan economics. Afghanistan Securities and Exchange Commission (ASEC) under Excellency Minster of Finance and Governor of the Da Afghanistan Bank will be the authorized signatories approving certificates.
Special Purpose Vehicles governed by Ministry of Finance will be the operating bodies of the Sukuk projects plus issuing body if Afghanistan Securities Exchange Commission approves it.
Taskforce under the His Excellency Minister of Finance will be the strategic decision making authority to finalize the initial stages of the Sukuk drafting and launching of Islamic Bonds (Sukuk)
Under the tasks force working committees will be formed to work out on different aspects of Bonds and draft recommendations in order to speed the process of Sukuk launching.
Building on its ambition to become the developed country by 2023 , Afghanistan continues to drive its policy actions in various economic sectors and its macroeconomic management. Infrastructure investment is claimed as benefited solution offering diversification ,low double digit returns (majority from cash yield) and rest from capital appreciation. Sukuk (Islamic bonds) have played a crucial role in the infrastructure sector over the past decade, with proceeds raised from issuances being utilized for both low and high profile projects.
Initially, infrastructure investment in Afghanistan was controlled by structural obstacles and lack of financing options. Fortunately, now investors can benefit from additional sources of financing which means Islamic financing for infrastructure development is the new opportunity for investors. Islamic Banks and financing institutions are stepping up their efforts by providing finances and different financial solutions to minimize the risk of the investment in developing region . Islamic Financing is the new and innovative way to meet the needs of this continent to fund infrastructure development.
A Sukuk ( Islamic Bond), is the most important new source of financing for large constructions and longer tenure infrastructure projects. Sukuk will give a complete new horizon and a lifeline to Islamic finance to support infrastructure development in Afghanistan. According to Dr Alam Khan Hamdard Ahmadzai , Sukuk is the instrument that can play a potential role in large infrastructure developments projects which are large scale projects but basic necessity for this continent. Islamic Bond or Sukuk will give a new horizon to Afghanistan infrastructure market, can be more aggressively used in later years to develop Afghanistan’s infrastructure
Find Out More in Our Next Coming Issue 26