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Bangladesh is preparing to make a major stride toward inclusive and sustainable development through the introduction of orange sukuk.
Orange sukuk is an innovative Shariah-compliant financial instrument that integrates gender equality, environmental protection, and social inclusion into capital markets.
It has features akin to orange bonds, aimed at empowering women, supporting MSMEs, creating jobs, and uplifting rural communities, but is in alignment with Islamic finance principles.
Orange sukuk is expected to enable Bangladesh to raise capital that drives climate resilience, social justice, and economic empowerment. It also positions the country as a leader in leveraging faith-based finance for sustainable development.
The tool was formally introduced at a media briefing titled "Bangladesh orange bonds: mobilizing global capital for inclusive local growth" on Thursday at a hotel in the capital's Kawran Bazar. The event was hosted by Impact Investment Exchange (IIX), a global pioneer in impact finance.
In her welcome remarks, Professor Durreen Shahnaz, founder and CEO of IIX, highlighted the potential of orange sukuk to transform Bangladesh's financial landscape.
"True progress must be rooted in justice, inclusion, and climate action. Orange sukuk is designed to put these values at the heart of economic growth," she said.
"This instrument offers a faith-aligned, gender-responsive solution for building a more equitable and resilient Bangladesh."
Shahnaz emphasized that IIX has been working with both public and private sector partners to realize this vision. One such key player is the Infrastructure Development Company Limited (IDCOL), which has joined IIX to support the development and issuance of the country's first orange sukuk and orange bond.
She announced plans to launch a US$1 billion orange bond series, which will complement orange sukuk by mobilizing capital for sectors such as garments, agriculture, healthcare, MSMEs, and financial services.
The joint initiative is targeted at women, youth, and underserved populations, enabling them to adapt to climate change and build stronger livelihoods.
To scale this vision, IIX is forging strategic partnerships. It has signed an MoU with BRAC-EPL Investments Ltd. and a Letter of Intent with PRAN-RFL Group, among others, to explore the rollout of both orange sukuk and orange bonds.
During the event, IIX shared its broader ambition of building Orange Capital Market in Bangladesh -- one that drives measurable social and environmental impact while attracting both global and local investors. Orange sukuk, as a Shariah-compliant financial innovation, opens new doors for Islamic finance to directly contribute to the UN Sustainable Development Goals (SDGs).
The initiative particularly focuses on supporting MSMEs, especially those led by women, which currently account for about 27 per cent of Bangladesh's GDP. Expanding access to capital for these enterprises is seen as essential for inclusive growth and gender-equitable economic transformation.
As Bangladesh approaches middle-income country status by 2026, stakeholders at the briefing acknowledged key challenges ahead, including limited capital formation, declining foreign aid, and lack of tailored credit solutions. Orange sukuk and orange bonds are aimed at addressing these gaps with innovative, purpose-driven financing.
The briefing also cited the example of Indonesia, where the state-owned financial institution PT Permodalan Nasional Madani (PNM) has issued orange sukuk and orange bonds worth IDR 16 trillion (nearly US$980 million) to finance women-led MSMEs-demonstrating the scalability and success of such instruments in emerging economies.
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