Pakistan launches Shariah-compliant sovereign domestic green sukuk

Pakistan has launched its first sovereign domestic green sukuk worth 30 billion Pakistani rupees at the Pakistan Stock Exchange (PSX), marking a significant step in the country’s efforts to expand sustainable, Shariah-compliant financing.

Finance Minister Muhammad Aurangzeb, addressing the launch event via video link, stated that the issuance increases the share of Sukuk-based debt to approximately 14% of Pakistan’s total domestic debt, which currently stands at 37 trillion rupees.

Structured under Ijarah and issued through the sustainable investment sukuk framework, the three-year green sukuk features a variable rental rate and will be listed and tradable on the Pakistan Stock Exchange (PSX).

Proceeds from the issuance will be allocated to eligible green energy infrastructure projects, including the construction of three dams. The auction is open to local retail, institutional, and corporate investors, as well as to non-resident Pakistanis, Roshan Digital Account holders, and foreign investors.

The issuance is being led by Meezan Bank, with Dubai Islamic Bank, Bank Islami, and Alfalah Islamic acting as joint financial advisors.

The launch coincided with the PSX reaching an all-time high of 119,961.91 points last week. Aurangzeb said the sukuk reflects growing investor confidence in Pakistan’s economy and capital markets.