THE Federal Shariat Court (FSC) issued a landmark judgement on Thursday giving the government five years to implement an Islamic and interest-free banking system in the country, as the economic system of an Islamic country like Pakistan should be free of interest.
It stated that abolition of riba is fundamental for an Islamic system, adding that any transaction involving riba is wrong.
It also held that interest given on external and internal loans by the government also falls under riba.
There are clear Quranic injunctions against riba or interest, which is considered to be an exploitative system that perpetuates or often increases the gap between rich and poor humans in the society.
There are stark warnings against devouring usury as this has been described as ‘waging war against Allah Almighty and His Messenger’.
It has also been enjoined that Allah Almighty ‘destroys interest and increases charity’.
Pakistan was created in the name of Islam and 1973 Constitution stipulates “All existing laws shall be brought in conformity with the injunctions of Islam as laid down in the Holy Quran and Sunnah…. and no law shall be enacted which is repugnant to such injunctions”.
Therefore, establishment of a riba-free economy and financial system becomes a constitutional obligation but regrettably instead of moving towards this goal the successive governments sought refuge behind technicalities challenging such verdicts in this or that court or forum.
There is no doubt that the world economic system is highly complicated and it is a challenge for a country to devise a somewhat parallel system but given the level, growth and popularity of the Islamic banking, it should not be an impossibility to transform the existing system in accordance with Islamic concepts and that too within five years that the FSC has given to the Government to do so.
Though full and comprehensive reaction and strategy of the Government is not yet known but in the immediate context it is appreciable that Minister for Finance Miftah Ismail has welcomed the verdict in Riba case, adding the government and SBP will carefully study this important decision and then seek guidance and clarification from the FSC about the process, steps and time-frame to implement this decision.
This newspaper is proud to be part of the process to create awareness and project the cause of Islamic banking as several roundtables were held on the topic where candid assessments were made and concrete proposals floated for the way forward.
We hope the issue would be thoroughly and minutely discussed by economic and financial experts as well as religious scholars of repute and based on successful experience of Islamic banking in Pakistan, a model would be evolved and implemented in a staggered manner but strictly within five years as mandated by the court.
