The Sindh government has approved an equity injection of Rs2 billion into Sindh Modaraba. This marks one of the biggest public-sector commitments to a Shariah-compliant financing institution in recent years. The company shared the update in a filing to the Pakistan Stock Exchange on Tuesday.
According to the disclosure, the provincial cabinet has cleared Rs1 billion for FY 2025–26. Another Rs1 billion will be released in FY 2026–27. The financial support aims to strengthen the institution’s Islamic financing operations. It will also help expand the organisation’s physical presence across the province through new branches and additional staffing.
The company said the capital infusion will help maintain steady growth in profits. It also expects its portfolio size to increase as operations expand. The management believes the fresh funding will improve long-term stability and allow it to offer more Shariah-compliant products to customers.
Sindh Modaraba was established under the Modaraba Companies and Modaraba Ordinance of 1980. It is managed by Sindh Modaraba Management Limited and operates as a multi-purpose Islamic financing entity. The institution provides Shariah-compliant facilities to creditworthy clients, including businesses and individuals. Its model follows Islamic economic principles and avoids interest-based financing.
As part of organisational reforms, the board has appointed Chandio as the new chief executive officer of Sindh Modaraba Management Limited. The leadership change is expected to support operational strengthening and ensure smoother expansion in the coming years.
Under the traditional modaraba structure, investors act as Rab ul Mal and provide the capital. Managers, known as Mudarib, run the business and share profits according to a pre-agreed ratio. Financial losses are borne by the investor. This structure makes the model a core part of Islamic finance because it promotes risk sharing rather than interest-based returns.
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The latest decision highlights the Sindh government’s continued support for Islamic finance in the province. It also reflects the administration’s broader strategy to promote sustainable and ethical financial growth.
