Baku: Islamic finance is an important tool for inclusive economic development, said Chairman of the Central Bank of Azerbaijan Taleh Kazimov at the Global Islamic Finance Forum organized within the framework of the 51st Annual Meeting of the Islamic Development Bank (IsDB) Group held in Baku, APA reports.

According to Azeri-Press News Agency, Taleh Kazimov emphasized the increasing significance of Islamic finance due to changes in the global economy. He noted that the global economy is experiencing profound structural changes and that the increasing fragmentation in trade and rising uncertainties necessitate the development of adaptive and inclusive financial systems. Islamic finance, with its risk-sharing and ethics-based approach, provides practical tools that can aid in building these systems.

The CBA Chairman identified two main directions for the successful development of Islamic finance in Azerbaijan: improving the legal framework and ensuring transparency in the regulatory environment, and forming and developing professional human capital to ensure the efficient functioning of the Islamic finance system.

Taleh Kazimov also mentioned ongoing legislative amendments aimed at expanding the application of Islamic finance instruments. These amendments to the Civil Code, Tax Code, and financial legislation are intended to create an equal and neutral regulatory environment between conventional and Islamic finance.

He further explained that given the current level of preparedness of market participants, the 'Islamic window' model is being implemented at the initial stage. After assessing market demand, a decision will be made regarding full-scale implementation.

The CBA Chairman highlighted the use of the regulatory sandbox mechanism, where two banks are actively testing their products under the supervision of the Central Bank of Azerbaijan.