The capital market is a financial sector that is 'shar'i' in nature, especially stocks based on musyarakah contracts. Going forward, the Islamic capital market is expected to encourage the development of Islamic finance.
Based on OJK data, as of July 2021 Indonesia's Sharia capital market assets have reached IDR1,173.07 trillion, an increase of 8.9% from the December 2020 position of IDR1,1801.46 trillion. This condition shows that the Indonesian people are increasingly interested in making the Sharia capital market a financial instrument for investing and as an alternative financing.
In order to support the development of the Sharia capital market, the Government through the Ministry of Finance also participated in the issuance of State Sharia Securities (SBSN) or State Sukuk instruments. This state sukuk has two functions at once, namely deepening Sharia finance, especially the Sharia capital market and supporting state budget financing.
Several types of SBSN that have been issued by the Government include: Islamic Fixed Rate, Project Based Sukuk, Savings Sukuk, Retail Sukuk, and Global Sukuk. The total funds obtained from the issuance of SBSN until 30 September 2021 reached IDR1,900.77 trillion. SBSN Project Financing Sukuk has been issued since 2013 to finance infrastructure projects. The value continues to increase until the total reaches IDR145.84 trillion for 3,447 projects in 34 provinces. Projects include infrastructure, education, health, public services, and social sectors.
The government has also participated in maintaining environmental and social sustainability through the issuance of Green Sukuk. The government has issued Green Sukuk in the global market 4 times, namely 2018 (USD1.25 billion), 2019 (USD750 million), 2020 (USD750 million), and 2021 (USD750 million). Even the 2021 issuance made history as the first Green Sukuk issued by the government in a long-term tenor of 30 years. Sukuk is also used for blended finance, synergising commercial and social Sharia finance.
The government together with relevant stakeholders has developed an innovative capital market instrument, namely Cash Waqf Linked Sukuk (CWLS). CWLS is designed as an instrument to encourage the development of productive waqf, with the proceeds from the investment of cash waqf funds utilised for the creation of new waqf assets and the financing of social activities.
The first CWLS issuance, SW-001 series, was conducted on 10 March 2020 through a private placement method with BWI acting as the Nazir. By BWI, the proceeds from the investment in CWLS were channelled to renovate the construction and optimisation of the retina centre of the Achmad Wardi Waqf Hospital in Serang, Banten.
Unfortunately, this impressive and innovative development of state sukuk has not been followed by corporate sukuk issued by the private sector. Based on OJK and KSEI data, the outstanding value of Corporate Sukuk was stable at IDR35.88 trillion as of 30 June 2021, which experienced a gradual increase of 18.22% from the end of 2020 position of IDR30.35 trillion.
Sukuk is an example of the Government's presence in the development of the national Sharia economy, especially the Sharia capital market. The impact on the real sector is very high both for the economy and social. This further confirms the close relationship between Islamic Finance and the real sector.
