The Iranian parliament approved of a motion which allows the Ministry of Petroleum to issue 3 billion dollars worth of Islamic bonds (Sukuk) undersigned by the council of ministers.

During the Monday open session of the parliament, the lawmakers ratified a bill which allows the Rouhani administration to issue $3 billion dollars’ worth of Sukuk bonds in order to fund petroleum projects.

Islamic bonds, structured in such a way as to generate returns to investors without infringing Islamic law (that prohibits riba or interest.)

Sukuk represents undivided shares in the ownership of tangible assets relating to particular projects or special investment activity. A sukuk investor has a common share in the ownership of the assets linked to the investment although this does not represent a debt owed to the issuer of the bond.