Islamic Finance stands for justice, equity and excellence in providing financial services to society, Dr. Waquar Anwar, Finance Advisor at Markaz Jamaat-e-Islami Hind said while delivering Maulana Maududi Memorial Lecture on “Islamic Finance in India and Challenges Ahead” at Millat Campus, Gaya, Bihar on January 2. This lecture series has been a regular yearly feature, organised by the Islamic Centre, Gaya since 1996.
At the very outset, Mr. Shabbir Alam Khan set the tone of the lecture by introducing in brief the subject of this year’s Maulana Maududi Lecture.
Speaking as the guest speaker, Dr. Anwar highlighted the salient features of Islamic Finance. The basic principles of Islamic Finance are derived from the Qur’ān and Sunnah (Prophet Muhammad’s teachings).
Appreciating the efforts of Islamic jurists of the early period, he said that on the basis of about 400 Qur’ānic verses and 4000 Sunnah relating to different aspects of personal and collective life, the Islamic jurists derived lakhs of legal instructions applicable in the changing situations and circumstances towards solving the emerging problems and produced a juristic compendium for the posterity.
Dr. Anwar stated that Islam prohibits charging of interest and practice of gambling, ambiguity and concealment of information, deceit and fraud, hazardous activity and hoarding, etc. in financial transaction between persons and institutions with a view to promote justice, equity and excellence in financial affairs. He opined that there is a limited scope for Islamic Finance in India, especially for Islamic Banking some Acts need to be amended.
However, Islamic microfinance can be easily practised under the Cooperative Acts which can deliver good for the 85% poor people of the country. Islamic Finance aims at rotation of wealth in the society and discourages accumulation of wealth in a few hands. As such, it is obligatory to pay 2.5% of the residual wealth as Zakah at the end of a year and distribution of wealth of a deceased person as per inheritance laws of Islam. Lending, investing and business activities have been encouraged for circulation of wealth among all sections of society and poverty and economic disparities are contained with various socio-economic measures in an Islamic State.
Dr. Anwar opined that practitioners of Islamic Finance have to satisfy the general populace on the judicious and pragmatic nature of Islamic Finance and they have to demonstrate within the legal provisions of the country that Islamic financial institutions are best suited to the country. He said that the experiments of Islamic Finance were discussed at global level as an alternative system in view of researches made since 1960’s as well as some successes made by Islamic financial institutions in different countries, especially in oil rich Arab world and South-East Asian countries.
The experiments of South-East Asian countries would be a source of learning and inspiration for us in India because especially in Malaysia a majority of clients opting for Islamic Banking and Finance are people who do not profess Islam as their religion. During question hour, various issues relating to financial recession, bank interest and risk management in profit-loss sharing investment were discussed.
Mr. Arshad Ajmal, CEO of Sahulat Microfinance Society – a national NGO – launched the “Growth Fund” of Al-Khair Cooperative Credit Society at its Gaya branch. He said that the Growth Fund is a viable investment option for micro-savers who may purchase one unit of Rs.500/- or multiple of shares by pigmy savings on daily basis for this purpose which can be collected by the daily collectors of Al-Khair. The last six months experience shows that around 8% profit may be earned in six months.
The Managing Director of Al-Khair Mr. Sarfraz briefly apprised the audience of the eight years’ performance of Al-Khair in the field of microfinance activities being run on interest-free basis with its operational area covering Bihar, Jharkhand, Uttar Pradesh and Delhi.
On this occasion, a souvenir, edited and published by Mr. Tamimuddin Humble, Director of the Islamic Centre, was released by Prof. M.B. Zaman, former Head of Pol. Science, M.G. College, Gaya. The function was presided over by Prof. M.B. Zaman.