Dubai – UAE: The Islamic Capital Market (ICM) continues to consolidate its role as one of the fastest-growing segments of the global financial system, driven by sustained sukuk issuance, expansion of Islamic investment funds, and growing global demand for ethical and Shariah-compliant investment solutions.

Global Islamic finance assets reached an estimated USD 5.2 trillion in 2025 and are projected to approach USD 6 trillion by the end of 2026, reflecting steady growth across banking, takaful, and capital markets. Within this ecosystem, the Islamic Capital Market has emerged as a key growth engine.

Outstanding global sukuk have surpassed the USD 1 trillion mark, while annual sukuk issuance continues to range between USD 150–200 billion, led by key markets including Malaysia, Saudi Arabia, the UAE, and Indonesia. Sukuk instruments are increasingly being utilized for sovereign financing, infrastructure development, energy projects, and corporate funding, underlining their growing relevance in mainstream capital markets.

Beyond sukuk, the Islamic Capital Market now spans Shariah-compliant equities, Islamic investment funds, ETFs, REITs, indices, pension structures, and liquidity management instruments. Islamic investment funds manage assets exceeding USD 350 billion globally, supported by improved regulatory oversight, stronger Shariah governance, and more standardized screening methodologies. The expansion of Islamic indices and ETFs has further enhanced market accessibility, allowing both institutional and retail investors to engage with Shariah-compliant assets more efficiently.

Mr. Muhammad Zubair Mughal, Chief Executive Officer of AlHuda Centre of Islamic Banking and Economics (AlHuda CIBE), stated: “Islamic Capital Markets are no longer a niche alternative. They have become a strategic pillar of the global financial architecture, offering asset-backed, risk-sharing, and ethically aligned investment solutions. The continued growth of sukuk, Islamic funds, and Shariah-compliant capital market instruments reflects a global shift toward responsible finance that serves both economic and social objectives.”

Mr. Mughal further emphasized that non-Muslim investors are increasingly participating in Islamic Capital Market products due to their strong alignment with ESG principles, transparency, and real-economy linkage, particularly in infrastructure, energy, and sovereign financing.

AlHuda CIBE has been actively contributing to the development and strengthening of Islamic Capital Markets through advisory, research, and capacity-building initiatives across multiple jurisdictions. The institution supports regulators, financial institutions, and capital market players in sukuk structuring, Islamic fund development, Shariah governance frameworks, and regulatory alignment with international standards such as AAOIFI and IFSB. Its engagement spans sovereign and corporate sukuk, Islamic collective investment schemes, and Shariah compliance systems for capital market operations.

Looking ahead, the Islamic Capital Market is expected to maintain strong growth momentum, supported by continued sovereign sukuk issuance, ESG-driven investment trends, regulatory support in key jurisdictions, and technological advancements such as digital sukuk platforms and fintech-enabled Shariah investing. While challenges remain in standardization, liquidity, and product diversification, the long-term outlook remains positive as Islamic Capital Markets continue to integrate more deeply into the global financial landscape.

As ethical finance gains prominence worldwide, Islamic Capital Markets are no longer peripheral. They represent a strategic, scalable, and globally relevant system for mobilizing responsible capital and supporting sustainable economic development.

About AlHuda CIBE:

AlHuda Center of Islamic Banking and Economics (CIBE) is a well-recognized name in Islamic banking and finance industry for research and provide state-of-the-art Advisory Consultancy and Education through various well-recognized modes viz. Islamic Financial Product Development, Shariah Advisory, Trainings Workshops, and Islamic Microfinance and Takaful Consultancies etc. side by side through our distinguished, generally acceptable and known Publications in Islamic Banking and Finance.

We are dedicated to serving the community as a unique institution, advisory and capacity building for the last twelve years. The prime goal has always been to remain stick to the commitments providing Services not only in UAE/Pakistan but all over the world. We have so far served in more than 100 Countries for the development of Islamic Banking and Finance industry. For further Details about AlHuda CIBE, please visit: www.alhudacibe.com

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