This study aims to provide an analysis of state budget deficit and its financing through sovereign Ṣukūk instruments, from both conventional and Sharīʿah perspectives. This study includes the discussion on the problem of state budget deficit and the use of sovereign Ṣukūk as a means to finance a deficit when it occurs. The study uses qualitative method with descriptive analysis approach to describe the whole picture of state budget deficit problem in Indonesia. The study finds that the Government of Indonesia prefers the approach of state budget deficit in these 15 years since 2001, and also prefers to use the interest-based instruments in financing the state budget deficit rather than Islamic finance instruments such as Ṣukūk. The role of Ṣukūk in financing the state budget deficit in Indonesia is still not significant compared to government bonds due to some challenges. Amongs of them are related to both regulatory aspects and Sharīʿah aspects.

This study aims to provide an analysis of state budget deficit and its financing through sovereign Ṣukūk instruments, from both conventional and Sharīʿah perspectives. This study includes the discussion on the problem of state budget deficit and the use of sovereign Ṣukūk as a means to finance a deficit when it occurs. The study uses qualitative method with descriptive analysis approach to describe the whole picture of state budget deficit problem in Indonesia. The study finds that the Government of Indonesia prefers the approach of state budget deficit in these 15 years since 2001, and also prefers to use the interest-based instruments in financing the state budget deficit rather than Islamic finance instruments such as Ṣukūk. The role of Ṣukūk in financing the state budget deficit in Indonesia is still not significant compared to government bonds due to some challenges. Amongs of them are related to both regulatory aspects and Sharīʿah aspects.

This study aims to provide an analysis of state budget deficit and its financing through sovereign Ṣukūk instruments, from both conventional and Sharīʿah perspectives. This study includes the discussion on the problem of state budget deficit and the use of sovereign Ṣukūk as a means to finance a deficit when it occurs. The study uses qualitative method with descriptive analysis approach to describe the whole picture of state budget deficit problem in Indonesia. The study finds that the Government of Indonesia prefers the approach of state budget deficit in these 15 years since 2001, and also prefers to use the interest-based instruments in financing the state budget deficit rather than Islamic finance instruments such as Ṣukūk. The role of Ṣukūk in financing the state budget deficit in Indonesia is still not significant compared to government bonds due to some challenges. Amongs of them are related to both regulatory aspects and Sharīʿah aspects.