The House of Representatives approved on Tuesday the government's proposal for the use of state properties worth a total of Rp 30.2 trillion (US$3.5 billioin) as underlying assets for state sukuk (sharia bonds) it issues this year. (source)
Finance Minister Agus Martowardodjo said underlying assets was a principle requirement for sukuk issuances, thus it was necessary to continue to support Indonesia's promising sukuk market, citing the always "oversubscribed" status of the state sukuk the government had issued so far.
He explained before lawmakers of the Comission XI overseeing financial affairs, however, that the to-be-issued sukuk were not intended for specific projects, but were intended to generally help the government cover the 2011 state budget deficits.
Lawmakers requested that next time the government should issue project-based sukuk so as to enable evaluation of the financing.
Agus added that state properties that would be used as the underlying assets were buildings and land belonging to ministries and other government institutions.
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