SUKUK AS AN ISLAMIC FINANCIAL INSTRUMENT: PROSPECTS FOR ITS IMPLEMENTATION IN UZBEKISTAN

Resumen

The integration of Islamic financial instruments into transition economies represents a paradigm shift in domestic capital mobilization, financial inclusion, and global financial intermediation. This comprehensive report analyzes the prospects for implementing Sukuk (Islamic investment certificates) in the Republic of Uzbekistan, framing the discourse within the context of the nation's recent legislative milestones, demographic shifts, and broader macroeconomic imperatives. Driven by a rapidly expanding, predominantly Muslim population exceeding 37.7 million and an ambitious national development agenda (the "Uzbekistan - 2030" Strategy), Uzbekistan faces an acute need to diversify its financial architecture and attract foreign direct investment. Utilizing a synthesis of recent empirical demand modeling, legislative review, and comparative regional analysis, this study evaluates the behavioral, regulatory, and geoeconomic determinants of Sukuk adoption. Empirical data reveals that 94.9% of surveyed demographics exhibit a conditional or unconditional intent to invest in Sukuk, exposing a vast reservoir of dormant retail capital currently excluded from the conventional banking sector due to religious convictions against interest-based financing. The ratification of Law No. LRU-1126 in March 2026 marks a watershed moment, establishing a definitive legal framework for Shariah-compliant operations, eliminating structural dual-taxation barriers such as Value Added Tax on asset transfers, and instituting a centralized Council for Islamic Finance. The analysis indicates that while Uzbekistan is strategically positioned to challenge regional incumbent Kazakhstan for Central Asian Islamic finance supremacy, persistent structural bottlenecks remain. These include an underdeveloped sovereign liquidity management infrastructure, a deficit in specialized human capital, and the critical need for robust secondary legislation aligned with the Accounting and Auditing Organization for Islamic Financial Institutions (AAOIFI) standards. The findings suggest that the successful deployment of sovereign and corporate Sukuk will not only catalyze infrastructure and corporate financing but also fundamentally restructure Uzbekistan's capital markets by integrating them into the multi-trillion-dollar global Islamic financial ecosystem.