IsDB Institute, ITFC Inaugurate First Comprehensive Report on Islamic Finance in Azerbaijan
Suday Okobi in Baku, Azerbaijan
The Islamic Development Bank Institute (IsDBI) and the International Islamic Trade Finance Corporation (ITFC), members of the IsDB Group, have launched a landmark report titled ‘Islamic Finance in Azerbaijan: Breaking New Ground’, providing a comprehensive assessment of the opportunities, challenges, and future development pathway for Islamic finance in Azerbaijan.
The report was launched on June 17, 2026, during the 20th IsDB Global Forum on Islamic Finance, held in conjunction with the IsDB Group Annual Meetings in Baku, Azerbaijan.
The report highlights Azerbaijan’s strong potential to develop a vibrant Islamic finance ecosystem, supported by its predominantly Muslim population, investment-grade sovereign ratings, ongoing regulatory reforms, and strategic location connecting Central Asia, the Caucasus, the Middle East, and Europe.
They stated that recent developments, including the introduction of pilot Islamic banking products under the regulatory sandbox of the Central Bank of the Republic of Azerbaijan (CBAR) and ongoing legal and regulatory reforms, have signaled growing momentum toward establishing the foundations of Islamic finance in the country.
The report projects that Islamic banking assets in Azerbaijan could reach approximately USD 2.7 billion by 2035, while cumulative ṣukūk issuances could grow to USD 1.5 billion by 2035, creating new opportunities for investment mobilisation, trade finance, financial inclusion, and private sector development.
Commenting on the issuance of the report, the acting Director-General of IsDB Institute, Dr. Sami Al-Suwailem, said: “Azerbaijan is well positioned to develop a credible and sustainable Islamic finance ecosystem. We hope this report serves as a practical reference for policymakers and industry stakeholders as they advance this important agenda.”
Also, Adeeb Yousuf Al Aama, the CEO of ITFC, added that: “Islamic finance can play an important role in supporting trade, investment, and private sector growth in Azerbaijan. ITFC remains committed to supporting the country’s development journey through innovative Shariah-compliant solutions.”
The report concluded with a phased development roadmap focusing on regulatory reform, sector development, capacity building, awareness enhancement, and regional positioning. “Together, these measures can support Azerbaijan’s ambition to become a leading Islamic finance hub in the Commonwealth of Independent States (CIS) region,” the reported.
