ASIATODAY.ID, JAKARTA — As the global halal economy enters a new phase of expansion, Indonesia is positioning itself to become more than the world’s largest Muslim consumer market. The country is now seeking to emerge as a leading producer, exporter and financial hub for Islamic industries, intensifying efforts to capture a greater share of one of the world’s fastest-growing economic sectors.
The strategy reflects a broader shift in global competition, with countries including Malaysia, Saudi Arabia, the United Arab Emirates and Türkiye investing heavily in halal manufacturing, Islamic finance, digital services and Muslim-friendly tourism to secure leadership in a market that continues to expand alongside rising demand from Muslim consumers worldwide.
For Indonesia, the opportunity is significant. Home to the world’s largest Muslim population and Southeast Asia’s biggest economy, the country possesses one of the deepest domestic halal markets. The challenge, however, is converting that demographic advantage into stronger exports, higher-value manufacturing, international investment and globally competitive Islamic financial services.
According to the State of the Global Islamic Economy (SGIE) Report 2025/2026, Indonesia ranks fourth globally in the Islamic economy. The country leads the world in modest fashion, ranks second in Muslim-friendly tourism, and third in halal food, demonstrating growing competitiveness across several strategic industries while still trailing established regional leaders in the overall ecosystem.
Indonesia’s central bank believes closer integration between industry, finance and digital technology will determine whether the country can climb further in global rankings.
Speaking at a regional Islamic economy forum in Mataram, Bank Indonesia Senior Deputy Governor Destry Damayanti said stronger coordination among government agencies, financial institutions, businesses and regional administrations is essential to accelerate the development of a more competitive halal ecosystem.
Recent data suggest the sector continues to gather momentum.
Indonesia’s sharia economy expanded 6.21% year-on-year in 2025, supported by continued growth across the halal value chain. Islamic banking financing reached IDR709 trillion (about US$43.7 billion) as of May 2026, up 10.42% from a year earlier, while deposits rose 11.75% to IDR792 trillion (around US$48.9 billion).
The central bank is also seeking to broaden halal certification, strengthen export-oriented halal supply chains, expand financing for small businesses, develop Islamic boarding school enterprises and accelerate digital Islamic finance as part of a broader strategy to improve Indonesia’s competitiveness.
The latest initiatives are expected to facilitate IDR11 billion in new sharia financing while generating IDR1.5 billion in transactions for halal-focused micro, small and medium-sized enterprises.
Economists increasingly view the halal economy as more than a niche religious market. It has evolved into a global industry encompassing food production, pharmaceuticals, cosmetics, fashion, logistics, tourism and financial services, creating new opportunities for countries able to build internationally recognised halal standards and integrated industrial ecosystems.
For Indonesia, success will depend not only on domestic consumption but on its ability to move higher up global value chains, expand halal exports and attract investment into industries that serve Muslim consumers across Asia, the Middle East and Africa.
The country’s latest policy push signals an ambition to transform its demographic advantage into long-term economic influence, positioning Indonesia as a major player in the evolving global Islamic economy rather than simply one of its largest markets. (AT Network)
Follow Us at Google News, Instagram, WA Channel, and LinkedIn