IT is a matter of great satisfaction to see the country moving towards implementation of an Islamic finance system and a riba free banking. The present government appears to be serious as it has taken some practical measures such as formation of a task force to prepare a roadmap to implement Shariah Court judgment which calls for an interest-free system in a matter of five years.
The Senate on Monday also passed a very important resolution demanding establishment of an interest-free financial and economic system in the country. It said that the government should enact laws for prohibiting individual and collective interest/riba based business in the country. Indeed, there are unambiguous directions against interest both in the Holy Quran and Hadith. Under the Islamic law it is proscribed. This country was carved out in the name of Islam and it is by following Islamic principles we can steer the country in the right direction. There is a great demand of Islamic banking in Pakistan as the people prefer doing Shariah-compliant banking over interest-based banking, and this is why many Islamic banks have opened and are operating whilst the conventional ones are also switching to it. We firmly believe that the rapid growth of Islamic banking may also enhance financial inclusion by providing an alternative to those who have voluntarily excluded themselves from the conventional financial system due to its interest-based nature. Hence it can prove to be a great way of including those who have been excluded. Islamic finance helps promote financial sector development and broadens financial inclusion. Islamic finance emphasises partnership-style financing which could be useful in improving access to finance for the poor and small businesses. Whilst the Senate resolution is highly welcomed, it is also important the elected representatives also give their suggestions to ensure full implementation of Shariah Court judgment in the given time frame. The process must be started to train and familiarize the banking professionals as well as those who aspire to join banks in Islamic finance so that there is no shortage of trained Islamic bankers. Universities should introduce Islamic banking as a specialised course for students of business, commerce and economics. Then greater awareness needs to be raised about the Islamic financial system while addressing the misconceptions.
