In its relentless pursuit to introduce Islamic Finance and Banking in India, a delegation of Indian Centre for Islamic Finance-ICIF called on Union Minister of State for Finance Namo Narain Meena at his residence in the Capital on Mar 26. The delegation presented important documents to the minister and discussed the possibility of introducing Islamic banking windows in the conventional banks as a pilot project to start with, and also constituting an expert committee to look into the feasibility of Interest-free Islamic banking in the country, taking into account the experiences in modern, secular and industrialised countries like UK, Japan, France, Singapore and Hong Kong and recently in China.
The delegation also convinced the minister that this system of banking is not confined to a particular class or particular religious followers. It pointed out that as countries like China are forging ahead into Islamic Banking in a big way, India that has a tremendous potential to introduce this system also should not lag behind. India has a preferable edge over China because of the historical ties and cultural affinity between GCC countries.
Referring to two documents – Standard & Poor’s “Will Islamic finance play a key role in funding Asia’s huge infrastructure task?” and The Economists in which details of Sukuk-asset based bonds for infrastructure development were discussed, the minister enquired more on its details and assured the delegation that he would go through the documents and forward them to RBI for follow-up action.
ICIF General Secretary also referred to the recommendations of the Committee on Financial Sector Reforms chaired by Dr Raghuram Rajan of the Planning Commission of India which recommended interest-free banking to be introduced in the main banking system for inclusive growth with innovation.
The delegation made the following two specific requests before the Minister:
a) To introduce Alternate Banking Window as a pilot project in the conventional Bank, which requires only an executive order from the Finance Ministry. A document in this regard has been submitted to the Finance Ministry.
b) To constitute a committee of experts to explore the feasibility of alternative interest free banking in the country in the light of the experiments carried out in modern, secular and industrialised countries like UK, Hong Kong, Singapore, Japan and recently in China as well.
The delegation consisted of ICIF General Secretary, Mr Abdur Raqeeb; Secretary Jamaat-e-Islami Hind Er. Mohammed Salim, Mr. Ali Jasim and Mr. Anisur Rahman Nadvi of ICIF.