The report makes practical recommendations and strategic considerations tailored to the specific dynamics of the region
ALGIERS, Algeria, May 20, 2025/APO Group/ --
The Eurasian Development Bank, the Islamic Development Bank Institute (www.IsDBInstitute.org) and the London Stock Exchange Group have published a joint research on the future of Islamic finance in Central Asia. The joint research was presented at the 2025 Islamic Development Group’s Annual Meetings in Algiers, Algeria.

Eurasian Development Bank, Islamic Development Bank Institute and London Stock Exchange Group Publish New Report on the Future of Islamic Finance in Central Asia

Islamic Finance market Outlook for Central Asia
This report provides a comprehensive analysis of the current status and prospects of Islamic finance globally and in Central Asia, comprising Kazakhstan, Kyrgyzstan, Tajikistan, Turkmenistan, and Uzbekistan. The report makes practical recommendations and strategic considerations tailored to the specific dynamics of the region, addressing regulatory harmonisation, capacity building, product innovation, and awareness campaigns. The research demonstrates that the region offers a unique opportunity for the growth of Sharia-compliant financial products and services, due to its rich cultural heritage, significant Muslim population, and rising demand for investments.
The region of Central Asia (Kazakhstan, Kyrgyzstan, Tajikistan, Turkmenistan, and Uzbekistan) is dynamically changing, and its role in Eurasia and the world needs to be reassessed. The population of Central Asia is 80 million people. This is a 40% increase since 2000. It keeps growing at 2% per year. In 2024, the aggregate GDP of the Central Asia countries was $519 billion). Over the last two decades, it grew nominally at 6.4% on average. Foreign trade turnover has increased almost ninefold since 2000. Foreign direct investments have increased 17 times. For over 20 years, Central Asia has been growing faster than developing countries on average.
Sharī‘ah-compliant financing, as a relatively new (more than 30 years old) and fast-growing segment of the global financial system, plays an increasingly important role in the sustainable development of the Central Asian states. All governments of the region are paying special attention to the development of Islamic finance. Islamic finance offers a unique opportunity for Central Asia to promote inclusive growth, financial stability, and sustainability. Overcoming challenges such as regulatory inconsistencies and talent shortages will require coordinated efforts and innovative solutions. By capitalizing on its strategic advantages, the region can position itself as a key player in the global Islamic finance industry.
The region of Central Asia currently has 11 Islamic banks and 11 non-banking financial institutions, as well as Islamic banking windows. Other institutions include takaful operators, microfinancing, investment companies, Ijara or leasing companies, and Islamic FinTechs such as digital banks and wealth management platforms. Islamic capital market instruments such as ṣukūk are developing more slowly than Islamic financial institutions, however.
Islamic finance assets in Central Asia amount to USD 699 million at the beginning of 2024. According to the Islamic Finance Development Report 2024, Kazakhstan ranks 19th in the world in terms of Islamic finance development in 2024 (i.e. above the global average) and leads the Central Asian market.
In the next ten years, there is a perspective for significant growth and development in the Islamic finance industry in the region, driven mainly by the Islamic banking sector and the ṣukūk asset class (Energy, Transport & Logistics, Industry, Food Security and Social Infrastructure are priority areas of investment). A baseline scenario based on the growth of financial intermediation and an estimate of the change in the share of Islamic finance in the financial sector structure was used to project the increase in Islamic finance assets in the region.
This approach assumes an increase in Islamic banking assets in Central Asia to the level of USD 2.5 billion in 2028 and USD 6.3 billion in 2033. Given the favourable demographics, strong economic growth, and the substantial size of the banking industry in each of the five Central Asian nations, Kazakhstan is expected to be the leader, followed closely by Uzbekistan. The region’s Ṣukūk market is also expected to witness significant expansion: the baseline forecasts suggest that Ṣukūk market is anticipated to grow to USD 2.05 billion by 2028 and USD 5.6 billion by 2033.
The Islamic finance industry faces challenges such as lack of standardisation, and the need for robust risk management frameworks. For that reason, regulatory harmonisation across Central Asian countries is crucial to attract foreign investment and facilitate cross-border transactions.
The report stresses the need for cooperation of the multilateral financial institutions and International Islamic banks on creating Sharia-compliant products and services tailored to the specific needs of Central Asian markets, including development of “Islamic windows” in conventional financial institutions as a sustainability milestone and innovative solutions for microfinance, agriculture financing, and renewable energy financing. International Islamic banks from more mature Islamic finance jurisdictions such as the Gulf countries and Southeast Asia can help build capacity in Central Asian Islamic banking ecosystems and can enable knowledge transfers in Central Asian countries to enhance the levels of Islamic finance technical expertise they can draw upon.
“One of the EDB's strategic priorities is to become a platform for Islamic finance in Central Asia. The further development of Islamic finance in Central Asia will expand financial inclusion and connect local businesses to the global Islamic market, contributing to regional economic growth. With the Islamic Development Bank Group’s support, EDB has started to develop an “Islamic Window” for financing projects in accordance with Sharia principles. The priority areas of investments will be energy, transport, social infrastructure, food security and industry”, says Mr Nikolai Podguzov, EDB Chairman.
In a message published in the report, Chairman of the IsDB Group, H.E. Dr. Muhammad Al Jasser, said, “The Islamic Development Bank Group is committed to supporting the advancement of Islamic finance in Central Asia and beyond. Our collaboration with Eurasian Development Bank demonstrates how development banks can work together to create inclusive and resilient financial systems.”
The report concludes that Islamic finance holds immense potential to contribute to economic development, financial inclusion, and foster good governance practices in Central Asia. By capitalizing on the region's unique opportunities and addressing existing challenges through collaborative efforts, Islamic finance can emerge as one more source of sustainable growth and prosperity in the region.
The report “The Future of Islamic Finance in Central Asia” is accessible on IsDBI website here: https://isdbinstitute.org/product/future-of-islamic-finance-in-central-asia/
Distributed by APO Group on behalf of Islamic Development Bank Institute (IsDBI).
well prepared and congratulation to somaliland community UK Sheffield. we are very appreciated for the much effort u have shown to move forward as cry freedom INSHALLAH will be soon recognized. In time, we shall be in a position to bestow on somaliland the greatest possible gift – a more human face.
I am sure that Inshallah we will make it and Somaliland will shine despite the envy of all enemies. Our honorable Somalilanders inside the country and abroad will excel Inshallah. Viva Somaliland!
thanks for support and encouragement u have shown as somalilander. bravo !!!!!!!!! cheers rise thumb higher
Thanks brother, I’m sure with the help of the Almighty Allah and the blessed hard work of our people we will achieve our good aims.
Keep up with the good work.
Job well done to the Somaliland community in the city of Sheffield, the UK, and the landers in Europe. We as Somalilander have to follow the examples of the Landers in Sheffield and we can just sit on our behind and wait for recognition, we have to fight for recognition and that Somalilanders in North America are not patriots and they never in 23 years of Somaliland existence fought for the recognition of Somaliland nor talked about development and the time that we get together is for may 18th parties to shake their behinds and they don’t give about Somaliiland and they are lazy and they are not as active as the European Landers. I am proud to the Somaliland not only in Sheffield, the whole of the nation of the UK but all of them in Europe who have made it possible. It is sad that Canada and America are the most powerful countries in the world but the landers there are not doing damn thing about it. I have a right to express my feelings and it is called freedom of expression, and getting angering and denying that this stuff is true is not going to solve anything and it is better to say that we are sorry that we don’t fight for the recognition of Somaliland and we don’t support the developments in Somaliland, and having gatherings for the cause of Somaliland. Instead of saying this I live in Canada and this is not true and Awal you are a liar and you have not lived in Canada for nearly a decade and you don’t have any idea that what the landers think of the country in North America, We don’t ever invite the presidents of Somaliland to Canada, it’s because you guys don’t want show your true colors and the Canadian government would have been delighted that Somaliland president makes a visit to Canada and if we the Somalilanders in Canada and America push for Somaliland’s recognition, then the US and Canada would be one of the first countries in the world to recognize and we as Landers would be honored in the home land and neighborhood would be named after us. After Canada and the US recognizes Somaliland InshAllah GOD willing Many countries allover will follow suit.