The global halal market is heating up, with Indonesia setting its sights on becoming the world’s leading producer of halal products by 2031. This ambition faces stiff competition from established players like Malaysia and is further complicated by the UAE’s aggressive push to dominate Islamic finance, backed by a massive $2.56 trillion strategy.
Indonesia’s Halal Ambitions
Indonesia, with the world’s largest Muslim population, is making a concerted effort to lead the halal industry. The Ministry of Industry has declared its intention to become the top halal product producer, leveraging the sector’s significant export potential. In 2024, Indonesia’s halal export transactions reached US$64.11 billion, signaling a strong foundation for growth. Deputy Minister Faisol Riza has emphasized the importance of strengthening the halal industry ecosystem to achieve this goal. To further promote its halal industry, Indonesia will host the Halal Indonesia International Industry Expo (Halal Indo) in September 2025.
Currently, Indonesia ranks third in the global Islamic economy, behind Malaysia and Saudi Arabia, according to the State of the Global Islamic Economy Report 2023/2024. Surpassing Malaysia will require significant investment, innovation, and strategic policy implementation.
UAE’s Islamic Finance Power Play
The UAE is making a bold move to become a global leader in Islamic finance and the halal industry. On May 6, 2025, the UAE Cabinet approved a National Strategy for Islamic Finance and the Halal Industry. This strategy aims to increase Islamic bank assets from Dh 986 billion to a staggering Dh 2.56 trillion within six years. Additionally, the UAE plans to raise the value of Islamic sukuk issuances listed in the UAE to over Dh 660 billion by 2031.
This ambitious strategy includes enhancing the export of halal products worldwide and positioning the UAE as a central hub for Islamic finance activities. A dedicated committee will oversee the execution of this strategy, ensuring coordinated efforts across various sectors.
The Halal Market Landscape
The halal industry is experiencing substantial growth, driven by a growing Muslim population and increasing awareness of halal products. The Muslim population is projected to reach 2.8 billion by 2050, creating a massive market for halal goods and services. Beyond food, the halal sector includes finance, cosmetics, and tourism, offering diverse opportunities for growth.
Furthermore, the perception of halal products as pure and hygienic is attracting a broader consumer base, including non-Muslims. This expanding market presents both opportunities and challenges for countries vying for leadership in the halal industry.
The Road Ahead
As 2031 approaches, the race to dominate the halal market is intensifying. Indonesia’s ambition to dethrone Malaysia is ambitious but achievable with strategic investments and policy support. However, the UAE’s entry into the arena with its massive financial backing adds a new dimension to the competition. The interplay between these key players will shape the future of the global halal industry.