Pakistan’s government sold Rs4.4 trillion (about $15.8 billion) of Sukuk, or Islamic bonds, in 2026, more than double the roughly Rs2 trillion ($7.2 billion) issued in 2025, a jump of 113%. Finance Minister Muhammad Aurangzeb shared the figures in Karachi on November 12 at an event marking a milestone of around Rs10 trillion ($35.8 billion) in cumulative Sukuk issuance, while admitting that foreign investors are still largely staying away.
A five-year surge in Islamic borrowing
According to Arab News Pakistan, issuance stood at only about Rs761 billion ($2.7 billion) in 2020, which means Sukuk sales have grown at a compound rate of roughly 22% a year over five years. Earlier, official figures showed sovereign Sukuk issuance nearly doubling to a record PKR 3.5 trillion in fiscal year 2026, up from PKR 2.2 trillion a year earlier.
Government Sukuk are issued through the Pakistan Domestic Sukuk Company, a wholly owned subsidiary of the Ministry of Finance, and many are now listed and auctioned on the Pakistan Stock Exchange. Most are based on ijarah, where investors own a share of a government asset and receive rent, rather than earning interest.
“Underwhelming” foreign interest
Despite the growth, Aurangzeb said foreign investment in Sukuk remains underwhelming, even as overseas money has flowed into conventional treasury bills and bonds through special convertible rupee accounts. He called for Sukuk to be actively marketed to international investors and for closer coordination among the SECP, the State Bank of Pakistan, the stock exchange, the Central Depository Company, banks and brokers to build a deeper Islamic capital market.
Measures mentioned include hybrid government Sukuk developed with the State Bank that combine different Shariah-compliant structures, and shorter three- and six-month Sukuk to create a reliable yield curve. The minister also urged continued dialogue between Ulema, regulators and policymakers on Islamic finance.
Why it matters
Pakistan’s growing Sukuk market shows that a large economy can fund a substantial part of its borrowing through riba-free instruments. It also gives Islamic banks and Muslim savers more Shariah-compliant places to invest. Globally, sukuk issuance hit a record $291.4 billion in 2025, according to the ICD-LSEG Islamic Finance Development Report; read our report on global Islamic finance assets reaching $6.5 trillion.
Key details
- 2026 Sukuk issuance: Rs4.4 trillion (about $15.8 billion)
- 2025 issuance: about Rs2 trillion ($7.2 billion); growth of 113%
- Cumulative issuance: about Rs10 trillion ($35.8 billion)
- 2020 issuance: about Rs761 billion; five-year growth of about 22% a year
- Announced by: Finance Minister Muhammad Aurangzeb, Karachi, November 12, 2026
Want to know how Sukuk differ from ordinary bonds, and whether you can invest in them? See our Halal Money section and Halal Investing for Beginners.
Sources: Arab News Pakistan (November 12, 2026); Nukta; Pakistan Stock Exchange term sheets. This article is general information, not investment advice.
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