A leading Bahrain-based international non-profit, aimed at developing the global Islamic finance industry, has showed interest in enhancing collaboration with Pakistan on promoting the Islamic capital market in the South Asian country, the Pakistani finance ministry on the other day, Arab News reported.
The conference was jointly organized by the Securities and Exchange Commission of Pakistan and the Accounting & Auditing Organization for Islamic Financial Institutions, the Bahraini firm responsible for the development and issuance of standards in the areas of Shariah, accounting, auditing, ethics and governance for international Islamic finance globally.
Sheikh Ebrahim Bin Khalifa Al-Khalifa, who is the chairman of the Accounting & Auditing Organization for Islamic Financial Institutions Board of Trustees, held a meeting with Pakistan’s Finance Minister Ishaq Dar in the Pakistani capital and exchanged views with him on mutual collaboration in the field of Islamic finance.
The two figures discussed “enhancing mutual collaboration with Pakistan in social welfare, business & financial sectors,” the Pakistani finance ministry said in a statement. “And promoting Islamic finance industry and capital market in Pakistan.” Pakistan has the second-largest Muslim population in the world with very low banking penetration.
The government seeks to increase financial inclusion through promoting Islamic finance, as part of the National Financial Inclusion Strategy. Only 21 percent of the adult population had a bank account in 2017, with 13 percent of adults citing religious reasons for not having them, according to the World Bank.
The Securities and Exchange Commission of Pakistan and Accounting & Auditing Organization for Islamic Financial Institutions also signed an agreement at the conference for joint cooperation in areas of “common interest” that would support the development of the Islamic banking and finance industry.
In 2021, the government set a target of increasing the share of Shariah-compliant instruments in government securities to at least 10 percent by the end of 2022-2023. There are 22 Islamic banking institutions currently operating across the country.
The assets of Pakistan’s Islamic banking industry had posted a year-on-year growth of 29 percent in fiscal year 2022, Dar said as he addressed the Islamic Capital Markets Conference.—Agencies