Musharaka means sharing and most appropriately reflects Islamic principles.
A Musharaka agreement in a financing arrangement allows the “customer” to make progressive capital contributions. This reduces the financier’s equity share over time to a point when the asset belongs to the customer. this is referred to as “Diminishing Musharaka”.
Istisna (commissioned production)
Istisna relates to the sale of an item that does not currently exist (i.e. a project to be constructed) but will be created by a party. The agreement requires that party to manufacture or construct the item according to agreed plans and/or specifications at a pre-agreed price and to deliver the completed item on an agreed future date.