Islamic Finance Council to be established in Uzbekistan

An Islamic Finance Council will be established under the Central Bank of Uzbekistan. This was announced during a presentation reviewed on March 25 by President Shavkat Mirziyoyev, which focused on the establishment of the Tashkent International Financial Center, the launch of an International Digital Technologies Center, and the introduction of Islamic finance mechanisms in the banking system.

According to the report, Uzbekistan plans to introduce a range of Islamic finance instruments. These include murabaha (financing through deferred payment sales), mudaraba (profit-sharing financing or investment), wakala (agency-based financing or fund management), salam and istisna (financing through advance payment for goods), musharaka (joint partnership financing), and Islamic leasing (ijara), as well as other instruments not contradicting national legislation.

It is also proposed that value-added tax will not be applied to the markup on sold goods, income from investment deposits will be exempt from taxation, and Islamic leasing agreements will be equated with financial leasing and leasing operations.

To ensure systematic governance in the sector, an Islamic Finance Council will be established under the Central Bank. In addition, separate councils will be created within banks offering Islamic financial services. These bodies will be responsible for developing standards, assisting in drafting regulatory legal acts, providing interpretations on disputed issues, reviewing contracts and internal documents, and ensuring compliance oversight.

This year, at least one commercial bank is expected to launch an Islamic “window.” In 2026–2030, two fully-fledged Islamic banks are planned to be established. Overall, the reforms are expected to attract an additional $1 billion in investments and deposits during 2026–2030.