Islamic finance - The Times Of Central Asia

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DUMK

Kazakhstan to Launch AI-Powered Imam App

Kazakhstan’s Spiritual Administration of Muslims (DUMK) is set to integrate artificial intelligence into religious practice with the launch of Imam AI, a mobile application designed to provide believers with instant, Sharia-compliant answers to religious questions. The initiative aims to ease the burden on clergy and offer verified religious guidance in a digital format. According to DUMK, the adoption of AI reflects growing public demand for fast and reliable religious information. “In line with modern requirements, we need to systematically introduce the capabilities of artificial intelligence into the religious sphere,” the organization stated in a post on the muftyatkz Instagram page. The Imam AI app will be built on AI technology and will draw from authenticated sources of Islamic knowledge. Supreme Mufti Nauryzbay Kazhy Taganuly stated that the platform would comply fully with Sharia law while providing accessible, on-demand religious consultations. This development is part of a broader effort to digitally transform religious institutions in Kazakhstan. The country has already begun incorporating AI into public administration, notably with the introduction of SKAI, a neural network based on a national language model used in state and quasi-state management. As a further step, DUMK plans to draft a Digital Development Concept for 2026-2028, which will set priorities for the digitalization of religious activities. The Supreme Mufti stressed that failing to adapt to technological change means falling behind the needs of contemporary society. “We are living in an era of technology and digital opportunity. Our responsibility is the systematic and widespread use of digital solutions and artificial intelligence in religious practice, in full accordance with Sharia law,” Taganuly noted. Another key initiative involves the creation of an Islamic finance sector under DUMK. The Mufti stated that growing religious awareness and a desire for ethical earnings have fueled demand for financial products that align with Islamic principles. The new sector will offer Sharia reviews of financial instruments and issue fatwas related to leasing, insurance, investments, bonds, digital assets, and electronic payment systems. Together, the launch of Imam AI and the institutionalization of Islamic finance mark a broader convergence of religion, technology, and economics in Kazakhstan. A recent joint report by the Eurasian Development Bank, the Islamic Development Bank Institute, and the London Stock Exchange forecasts steady growth in Islamic finance across Central Asia. For Kazakhstan, the digitalization of the religious sphere is becoming a key component of its broader modernization agenda, positioning AI not as a novelty but as a practical tool for improving access and meeting evolving societal expectations.

Banking

Uzbekistan to Launch Islamic Finance Services in 2027

Uzbekistan plans to introduce Islamic finance services at a national level, with the first offerings set to launch in 2027. According to the updated draft of the Uzbekistan 2030 development strategy, at least three commercial banks are expected to provide Sharia-compliant financial services by the end of the decade. The strategy outlines the creation of a legal and institutional framework to support Islamic finance, beginning with one commercial bank in 2027 and expanding to three banks by 2029-2030. The initiative will be financed through the banks’ own resources, with the Central Bank designated as the lead regulatory authority. This initiative follows earlier legislative steps aimed at diversifying Uzbekistan’s financial system. In September 2023, the Legislative Chamber of the country's parliament, the Oliy Majlis, passed a draft law on Islamic banking in its first reading, a milestone in the country’s push toward financial innovation and inclusion. As previously reported by The Times of Central Asia, the draft legislation includes amendments to the Tax Code, Civil Code, and other legal statutes. It introduces formal definitions for Islamic banks, Sharia-compliant operations, investment deposits, and relevant regulatory standards. Central Bank Deputy Chairman Abrorkhuja Turdaliev has emphasized that the reforms go beyond removing legal obstacles. In comments to local media, he highlighted the need to establish institutional mechanisms, including specialized Sharia councils, audit and accounting frameworks, and a dedicated tax regime, to ensure the system functions in accordance with Islamic financial principles. In an interview with Spot, Turdaliev stated that the Central Bank expects up to ten Islamic banks to be operating in Uzbekistan by 2030. In addition, several traditional banks, including three state-owned institutions, are expected to launch Islamic “windows” to provide Sharia-compliant services alongside conventional products.

Geopolitics

Opinion: Multi-Vectorism 2.0 – Kazakhstan Seeks Balance in a Shifting Geopolitical Landscape

The world is reverting to the logic of bloc confrontation. Sanctions regimes, technological barriers, and deepening mistrust between major powers are compelling medium-sized states to chart independent courses. Kazakhstan stands at the center of this evolving geopolitical matrix. While Moscow remains a vital partner in defense and energy, Astana is simultaneously cultivating strong ties with other global power centers, including China, the U.S., Turkey, the European Union, and the Gulf states. Yet Kazakhstan refuses to align with any single bloc, adhering instead to a strategy of "flexible autonomy", cooperating broadly while preserving its sovereignty. Russia: Alliance with Strategic Boundaries On November 11-12, 2025, President Kassym-Jomart Tokayev met with Russian President Vladimir Putin in Moscow. The two leaders signed a declaration on a comprehensive strategic partnership and alliance, reaffirming cooperation on security, energy, and logistics projects. Key discussions included the gasification of border regions, the modernization of energy infrastructure, and the transit of Russian energy via Kazakhstan. Tokayev emphasized Kazakhstan’s interest in a stable and prosperous Russia, calling Putin a “statesman of global stature.” Still, this alignment does not supplant Kazakhstan’s multi-vector policy. The Moscow visit directly followed Tokayev’s talks in Washington, underscoring that Astana views relations with Russia as one of several strategic pillars. The U.S.: Investment and Critical Minerals Diplomacy During Tokayev’s visit to the U.S. in early November 2025, he and President Donald Trump oversaw the signing of 29 agreements totaling approximately $17 billion. The deals spanned industry, energy, digitalization, education, and innovation. Highlights in recent collaboration between Kazakhstan and the U.S. include a $2.5 billion John Deere production facility in Kostanay and Turkestan, a $1.1 billion development of tungsten deposits, and over $1 billion in digital infrastructure cooperation with companies such as Hewlett Packard Enterprise, Oracle, and Starlink. Leading global funds also pledged roughly $1 billion in new investments. These agreements reflect growing trust and a shared commitment to investment-driven, high-tech cooperation. China: Strategic Synergy and Technological Convergence China remains Kazakhstan’s largest trading partner and a cornerstone of its eastern vector. During Tokayev’s October 17, 2023 visit to Beijing, he and President Xi Jinping reaffirmed a “comprehensive strategic partnership” built on political trust and economic cooperation. In June 2025, Xi Jinping visited Astana for the second China-Central Asia Summit, where he and Kassym‑Jomart Tokayev reinforced their countries’ “comprehensive strategic partnership”, oversaw deals spanning energy, infrastructure, agriculture, and digital technology. Later that year, at the Shanghai Cooperation Organisation summit in Tianjin, the two leaders used the platform to deepen cooperation within a multilateral framework, promoting connectivity and regional trade under the Belt and Road Initiative. Turkey: Civilizational Ties and Strategic Growth Ties between Kazakhstan and Turkey are underpinned by shared cultural and historical foundations. At the fifth High-Level Strategic Cooperation Council meeting in Ankara on July 29, 2025, President Recep Tayyip Erdoğan welcomed Tokayev, reaffirming Turkey’s role as a major investor and educational partner. More than 12,000 Kazakh students are enrolled in Turkish universities. Defense cooperation is expanding under the Organization of Turkic States (OTS), and tourism and...

Banking

Uzbekistan Advances Draft Law to Introduce Islamic Banking System

Uzbekistan has taken a major step toward diversifying its financial sector with the approval of a draft law on Islamic banking in its first reading. Lawmakers in the legislative chamber of the parliament, the Oliy Majlis, debated the bill during a session held on September 16. The initiative is part of the government's broader effort to expand access to financial services for citizens and businesses, attract foreign investment, and create new mechanisms for economic support. To this end, the draft proposes amendments to the Tax Code, Civil Code, and eight other laws. The bill formally introduces into legislation the concepts of Islamic banks, financial operations, standards, and investment deposits. It also outlines a licensing regime allowing for the establishment of either fully-fledged Islamic banks or Islamic “windows” within existing conventional banks. Permitted financial instruments will include murabaha, mudaraba, musharaka, wakala, and salam, contracts widely used in Islamic finance. Abrorkhoja Turdaliev, Deputy Chairman of the Central Bank, stated that the reforms go beyond removing legal barriers and are aimed at building the institutional foundations of Islamic finance. He highlighted the need to establish dedicated councils, audit bodies, and accounting systems to ensure compliance with Islamic financial principles. The bill also includes provisions for a special tax regime tailored to Islamic finance operations. Turdaliev noted that Islamic banking prohibits the charging of interest, the financing of activities forbidden under Islamic law, and excessive uncertainty in contracts. Instead, it emphasizes partnership and risk-sharing. To support this model, the draft law would eliminate restrictions that currently prevent banks from directly participating in trade or acquiring equity stakes in companies. Drawing on international experience from Malaysia, Turkey, the UAE, and neighboring countries, the proposed legal framework seeks to build a modern infrastructure for Islamic finance in Uzbekistan. “This law will provide legal grounds for establishing Islamic banks, Islamic windows, and microfinance institutions, thereby expanding access to alternative financial services and introducing new tools to support business,” Turdaliev said.

Islamic finance

New Report Predicts Surge in Islamic Finance Across Central Asia

A new report co-published by the Eurasian Development Bank (EDB), the Islamic Development Bank Institute, and the London Stock Exchange Group forecasts robust growth for Islamic finance in Central Asia. Titled “The Future of Islamic Finance in Central Asia,” the report was unveiled at the 2025 Annual Meetings of the Islamic Development Bank Group in Algiers, Algeria. The study offers a comprehensive overview of the Islamic finance landscape across Kazakhstan, Kyrgyzstan, Tajikistan, Turkmenistan, and Uzbekistan. While Sharia-compliant financing remains a relatively recent addition to the global financial system, having developed over the past three decades, it is becoming an increasingly significant component in the sustainable development strategies of Central Asian economies. All five governments are reportedly prioritizing the expansion of Islamic finance. As of early 2024, the region is home to 18 Islamic banks and 14 non-bank financial institutions, including Islamic banking windows. The sector also features takaful (Islamic insurance) operators, microfinance institutions, Ijara (leasing) companies, and emerging Islamic FinTech ventures such as digital banks and wealth management platforms. Total Islamic finance assets in Central Asia stood at $699 million at the start of 2024. According to the Islamic Finance Development Report 2024, Kazakhstan ranked 19th globally in terms of Islamic finance development, above the global average, and leads the regional market. Projections in the report anticipate substantial growth. Islamic banking assets in Central Asia are expected to rise to $2.5 billion by 2028 and $6.3 billion by 2033. Kazakhstan is forecasted to remain the regional leader, followed closely by Uzbekistan, buoyed by favorable demographics, economic momentum, and the depth of national banking sectors. The sukuk (Islamic bond) market is also poised for rapid expansion. Baseline forecasts suggest sukuk issuance could reach $2.05 billion by 2028 and $5.6 billion by 2033. EDB Chairman Nikolai Podguzov highlighted the bank’s commitment to fostering this growth: “The further development of Islamic finance in Central Asia will expand financial inclusion and connect local businesses to the global Islamic market, contributing to regional economic growth. With the Islamic Development Bank Group’s support, the EDB has initiated the creation of an Islamic Window to finance projects in compliance with Sharia principles.” He added that key investment priorities will include energy, transport, social infrastructure, food security, and industry.

Investments Islamic finance Banking Kazakhstan

DBK opens first Islamic lease financing in Kazakhstan

ASTANA (TCA) — The Development Bank of Kazakhstan (DBK) said that its subsidiary has funded its first transaction on the terms of Islamic leasing in Kazakhstan. Continue reading