Bangladesh is preparing to explore the launch of Orange Bonds and Orange Sukuks—innovative financial instruments aimed at empowering women, protecting the environment, generating employment, supporting MSMEs, and transforming rural communities, all while ensuring Shariah-compliant capital mobilisation.

The initiative reflects Bangladesh’s heritage in Islamic finance and presents a unique opportunity to integrate social and environmental goals into the financial system. According to a press release, the combined deployment of Orange Bonds and Orange Sukuks is expected to strengthen the country’s financial architecture while advancing inclusive and sustainable development.

These prospects were discussed at a media briefing titled ‘Bangladesh Orange Bonds: Mobilising Global Capital for Inclusive Local Growth’, held on Thursday at a hotel in Kawran Bazar, Dhaka. The event was organised by the Impact Investment Exchange (IIX), a pioneering organisation in global impact investing.

Prof Durreen Shahnaz, founder and CEO of IIX, delivered the welcome address, emphasising the need for justice, social inclusion, and climate action to underpin sustainable economic progress. “The Orange Bond plays a crucial role,” she stated. “Its core objective is to drive equality, inclusion, and climate resilience within Bangladesh’s economy.”

Debashis Roy, director of advisory and partnerships at IIX Bangladesh, and Bashar Rahman, analyst at IIX Bangladesh, also shared insights at the event.

In her address, Prof Shahnaz reiterated that economic progress cannot be truly sustainable unless grounded in justice and inclusivity. She noted that Orange Capital is designed to address this gap. “The Orange Bond and Orange Sukuk are intended to place equality, inclusion, and climate resilience at the heart of Bangladesh’s economic future,” she said. To realise this vision, IIX is partnering with key institutions such as the Infrastructure Development Company Limited (IDCOL).

She also revealed that preparations are underway for Bangladesh’s first Orange Bond issuance, targeting a US$1 billion launch in the near future.

The initiative aims not only to raise capital but also to support priority sectors including garments, agriculture, healthcare, financial services, and MSMEs. It particularly focuses on empowering women, youth, and marginalised communities, enabling them to better adapt to and mitigate the effects of climate change. IDCOL’s involvement reinforces the programme’s public interest and commitment to scale.

IIX is concurrently building private sector partnerships, having already signed a Memorandum of Understanding (MoU) with BRAC-EPL Investments Ltd, and a Letter of Intent (LoI) with PRAN-RFL Group, among others, to facilitate Orange Bond and Sukuk issuance.

At the briefing, IIX shared its broader vision for establishing an Orange Capital Market in Bangladesh, outlining its potential for local and global impact. Orange Bonds, it was noted, are the world’s first cross-sector financial instruments specifically designed to mobilise investment in key sectors aligned with the United Nations Sustainable Development Goals (SDGs).

The event also highlighted the pivotal role of MSMEs—particularly those led by women—which collectively contribute approximately 27% to Bangladesh’s GDP. Supporting these enterprises is crucial to fostering inclusive economic transformation and advancing gender equality in capital markets.

As Bangladesh moves towards attaining middle-income status by 2026, the briefing acknowledged several forthcoming challenges, including limited capital formation, insufficient demand-driven credit, and declining foreign aid—all of which may affect the trajectory of sustained economic growth.

The session also referenced Indonesia as a model of success, where state-owned financial institution PT Permodalan Nasional Madani (PNM) has already issued Orange Bonds and Orange Sukuks worth IDR 16 trillion (around $980 million), dedicated to financing women-led MSMEs.

READ MORE