Exploring FGN Sukuk as an Alternative and Sustainable Financing Option: A Case Study of Infrastructural Development in Nigeria

This study examines the federal government of Nigeria (FGN) Sukuk as a sustainable alternative to conventional financing for infrastructure development. Nigeria faces persistent challenges in financing infrastructure, including high costs, limited financial access, and stringent loan conditions from international lenders such as the World Bank and International Monetary Fund (IMF). The research aims to identify alternative funding mechanisms for the federal government's infrastructure programmes. Using a quantitative approach and secondary data from the Debt Management Office (DMO) of Nigeria between 2017 and 2023, the study analyses trends in infrastructure development through descriptive statistics and Python-based analysis. Findings reveal that FGN Sukuk offers a viable long-term financing option to address Nigeria's infrastructure deficits and budgetary constraints. As an Islamic financial instrument, Sukuk provides an alternative to conventional bonds while complying with sharia principles, thereby supporting economic growth and improving access to funding for critical projects. The study recommends expanding the application of Sukuk beyond infrastructure to sectors such as education, transportation, manufacturing, and telecommunications. It also emphasizes the importance of strengthening regulatory frameworks to maximize Sukuk's potential. Effective governance and regulatory quality are essential to enhance Nigeria's infrastructure and ensure Sukuk's role as a strategic financing tool for sustainable economic development.