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Pakistan's first ‘agri Sukuk' launched
Pakistan's first ‘agri Sukuk' launched

Business Recorder

time22-07-2025

  • Business
  • Business Recorder

Pakistan's first ‘agri Sukuk' launched

KARACHI: In a major development for Islamic finance and agricultural infrastructure, InfraZamin Pakistan, Sunridge Foods (Pvt) Limited and BankIslami Pakistan marked the launch of the country's first agri-infrastructure Sukuk with a ceremonial gong-striking at the Pakistan Stock Exchange (PSX). The fully subscribed Rs 2 billion Sukuk marks a pioneering milestone in Shariah-compliant, climate-resilient financing for Pakistan's agriculture sector. Structured under a robust governance framework, the Sukuk is backed by a 100 percent principal credit guarantee from InfraZamin Pakistan and has received a long-term AAA rating from VIS Credit Rating Company. InfraZamin, Sunridge Foods ink deal for Rs2bn Sukuk Institutional investors led the subscription, highlighting growing confidence in innovative Islamic finance instruments for infrastructure and development. BankIslami Pakistan acted as the Mandated Lead Arranger, while AKD Securities served as Financial Advisor. Al-Hilal Shariah Advisors ensured Shariah compliance, and Pak Brunei Investment Company Limited was appointed as Investment Agent and Trustee. The funds raised through the Sukuk will finance Sunridge Foods' Balancing, Modernization, and Replacement (BMR) projects. These include the installation of 1 MW wind turbines and a 0.5 MW solar power plant to reduce carbon emissions, as well as the construction of silos and warehouses to expand food storage capacity. A significant portion will also provide working capital support to Sunridge's wheat and rice processing units in Karachi and Lahore—facilitating enhanced production of essential staple foods. Analysts noted that The Sukuk launch represents a critical step in aligning Pakistan's capital markets with sustainable infrastructure development, climate goals, and food security priorities, reinforcing the role of Islamic finance in shaping an inclusive economic future. Chief Guest, Deputy British High Commissioner Lance Domm hailed the Sukuk as a significant step toward climate-resilient and sustainable economic growth. 'This transaction demonstrates how partnerships can mobilize private investment for development,' he noted, reaffirming the UK's commitment to support Pakistan's financial ecosystem through its collaboration with InfraZamin and others. InfraZamin CEO Maheen Rahman described the issuance as a transformative example of how credit guarantees can unlock access to capital markets for critical sectors like agriculture. 'We are committed to enabling long-term, sustainable financing solutions that support Pakistan's food security and economic resilience,' she said. Amir Shahzad, Chairman and Executive Director of Sunridge Foods, said the initiative would allow the company to modernize its operations and enhance renewable energy use. 'This Sukuk not only boosts our capacity but also strengthens Pakistan's food systems through sustainable and inclusive growth,' he stated. BankIslami CEO Rizwan Ata emphasized the growing relevance of Islamic finance in addressing development challenges. 'This Agri-Infrastructure Sukuk showcases the potential of Shariah-compliant instruments to channel capital toward national priorities,' he said. PSX Chairperson Dr. Shamshad Akhtar underscored that Pakistan's dual crises of climate change and food insecurity required bold, homegrown financial solutions. She termed the Sukuk a prime example of private sector innovation meeting public need. PSX CEO Farrukh Subzwari added that PSX is committed to fostering a sustainable finance ecosystem, calling on banks, fund managers, regulators, and corporates to collaborate on future initiatives that combine financial innovation with national development. Copyright Business Recorder, 2025

Pakistani consortium launches first Sharia-compliant Agri-Infrastructure Sukuks worth $7 million
Pakistani consortium launches first Sharia-compliant Agri-Infrastructure Sukuks worth $7 million

Arab News

time21-07-2025

  • Business
  • Arab News

Pakistani consortium launches first Sharia-compliant Agri-Infrastructure Sukuks worth $7 million

KARACHI: A consortium of Pakistani corporate entities on Monday launched the country's first, fully subscribed Rs2 billion ($7 million) Agri-Infrastructure Sukuk to bolster renewable energy efforts and enhance production of essential staple food items, with a ceremonial gong strike at the Pakistan Stock Exchange. Sukuk are financial certificates, often referred to as Islamic bonds, that represent ownership in an asset or a collection of assets and are designed to be Sharia-compliant by adhering to Islamic law, which prohibits interest-based transactions (riba). Instead of interest, sukuk holders receive a share of the profits generated by the underlying asset. The Shariah-compliant Sukuk is backed by a 100 percent principal credit guarantee from InfraZamin Pakistan, which mobilizes private investment in pioneering infrastructure. The financial certificate carries a long-term AAA rating by VIS Credit Rating Company and is fully subscribed by institutional investors, a major step toward sustainable financing via capital markets in the country's agricultural sector. The funds raised through the Sukuk, whose issuance is led by BankIslami Pakistan Limited as the mandated lead arranger, will be utilized to advance Sunridge Foods' Balancing, Modernization, and Replacement (BMR) projects, focused on upgrading production facilities with sustainable and energy-efficient technologies, according to InfraZamin Pakistan. 'Key components of the BMR include the installation of 1MW wind turbines and a 0.5MW solar power plant to bolster Sunridge's renewable energy efforts, alongside the construction of new silos and warehouses to substantially expand agricultural produce storage capacity,' InfraZamin said in a statement. 'Additionally, the proceeds will provide working capital support for Sunridge's critical wheat and rice processing plants in Karachi and Lahore, facilitating increased production of essential staple food items.' On the occasion, Deputy British High Commissioner in Karachi Lance Domm lauded the initiative as a significant step toward climate-resilient and sustainable economic growth through capital market innovation. 'This Sukuk represents a significant step in expanding access to climate-friendly, Shariah-compliant finance in Pakistan's agri-infrastructure sector,' Domm said. 'It reflects growing confidence in the country's capital markets and the role of partnerships in mobilizing private investment for development. The UK, through its support to InfraZamin and other financial institutions, remains committed to strengthening Pakistan's financial ecosystem.' InfraZamin Pakistan CEO Maheen Rahman highlighted the strategic importance of the transaction, saying it reflected their commitment to facilitating sustainable financing solutions that empower Pakistan's agriculture sector. 'By providing a principal credit guarantee, InfraZamin strengthens investor confidence and unlocks capital market access,' she said. Amir Shahzad, chairman and executive director of Sunridge Foods, emphasized the operational and environmental benefits of the development at the ceremony. 'At Sunridge Foods, we are proud to be part of this landmark issuance that channels Islamic finance toward strengthening Pakistan's agri-infrastructure,' Shahzad said. 'This Sukuk enables us to modernize our production capabilities, invest in renewable energy, and significantly expand our storage and processing capacity for essential food staples. It is a testament to how purpose-driven partnerships can unlock sustainable growth in critical sectors like food and agriculture.' The event at PSX underscored the collective vision of all stakeholders to foster innovative, Shariah-compliant financing avenues that drive Pakistan's sustainable infrastructure and agricultural development, according to InfraZamin. 'We are pleased to play our role in the launch of Pakistan's first Agri-Infrastructure Sukuk, marking a significant step forward in sustainable financing for the country,' said Rizwan Ata, president and CEO of BankIslami. 'This transaction highlights the growing recognition of Shariah-compliant finance as a core tool for driving economic growth while supporting sustainable development.' PSX Chairperson Dr. Shamshad Akhtar emphasized that Pakistan's intersecting crises of climate vulnerability and food insecurity demand bold, homegrown solutions. She commended the launch of the Agri-Infrastructure Sukuk as a defining example of how private sector leadership and financial innovation, particularly within Islamic finance, can mobilize capital toward climate resilience and agricultural development. '[Such initiatives are] powerful catalysts for inclusive growth, food system transformation, and a sustainable future built on values, ingenuity, and collaboration,' she was quoted as saying. PSX CEO Farrukh Subzwari reaffirmed the Exchange's commitment to transforming the capital market into a platform for purposeful solutions, especially in addressing climate risk, food insecurity, and the structural gaps facing Pakistan's economy. 'Banks, fund managers, corporates, regulators like SECP, and institutional investors must work together to build the ecosystem for sustainable finance,' the statement quoted him as saying. 'PSX will continue to serve not just as a marketplace, but as a catalyst for innovation, inclusion, and resilience— where ideas translate into impact and capital is mobilized for national priorities.'

Sunridge raises Rs2bn via Pakistan's first agri-infrastructure sukuk
Sunridge raises Rs2bn via Pakistan's first agri-infrastructure sukuk

Business Recorder

time21-07-2025

  • Business
  • Business Recorder

Sunridge raises Rs2bn via Pakistan's first agri-infrastructure sukuk

KARACHI: Sunridge Foods, a food processing company, has launched Pakistan's first fully subscribed agri-infrastructure sukuk, raising Rs2 billion in debt financing at the Pakistan Stock Exchange (PSX) on Monday. The sukuk issuance was arranged by BankIslami Pakistan with a 100% credit guarantee provided by InfraZamin Pakistan. Pakistan's real effective exchange rate hits 21-month low in June 2025 In a press statement, the company elaborated that the funds would be utilised to advance the company's balancing, modernisation, and replacement (BMR) projects, focused on upgrading production facilities with sustainable and energy-efficient technologies. 'Key components of the BMR include the installation of 1 MW wind turbines and a 0.5 MW solar power plant to bolster Sunridge's renewable energy efforts, alongside the construction of new silos and warehouses to substantially expand agricultural produce storage capacity. 'Additionally, the proceeds will provide working capital support for Sunridge's critical wheat and rice processing plants in Karachi and Lahore, facilitating increased production of essential staple food items,' the statement read. The sukuk issuance was led by BankIslami Pakistan Limited as the mandated lead arranger, fully subscribed by institutional investors. It was backed by a 100% principal credit guarantee from InfraZamin Pakistan and carried a long-term AAA rating assigned by VIS Credit Rating Company. 'This represents a pioneering step towards sustainable financing via capital markets in the country's agricultural sector.' The sukuk also involved AKD Securities as financial advisor, Al-Hilal Shariah Advisors as Shariah-compliance experts, and Pak Brunei Investment Company Limited as investment agent and trustee ensures robust governance and protection of the interests of sukuk holders under a Shariah-compliant framework. Deputy British High Commissioner Lance Domm hailed the sukuk as a milestone in expanding climate-friendly, Shariah-compliant finance in Pakistan's agri-infrastructure sector, believing it would make economic growth sustainable. 'The UK, through its support to InfraZamin and other financial institutions, remains committed to strengthening Pakistan's financial ecosystem,' he said. InfraZamin Pakistan CEO Maheen Rahman said the credit guarantee strengthened investor trust and unlocks capital for sustainable agriculture. Budgetary requirements: Ijara Sukuk funding to help govt save Rs32bn per year Sunridge Foods chairman Amir Shahzad noted the Sukuk would modernise production, boost renewable energy, and expand storage of essential food staples. BankIslami Pakistan president and CEO Rizwan Ata emphasised the importance of Shariah-compliant finance in driving sustainable economic growth. PSX chairperson Shamshad Akhtar praised the initiative as a bold, private-sector-led response to climate and food insecurity. PSX CEO Farrukh Subzwari reaffirmed the exchange's role in supporting purposeful, collaborative solutions that mobilise capital for national priorities and long-term sustainability.

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