The crux of Islamic finance, its viability, and abhorrence of unfair means, growth, challenges and its philanthropic and benevolence side was elucidated and simplified by Dr. M. Nejatullah Siddiqi, world renowned expert on Islamic finance, at a programme organised by Forum for Discussion on Economic Issues (FDEI), a joint forum of Sahulat and Radiance Viewsweekly in the national capital on 3 November.
Dr. Siddiqui, while highlighting the basics of Islamic Finance, said that the root of Islamic Finance is that there are two types of people. In the first category, there are poor people and if they are provided with money, they can do some constructive work for themselves and for others as well. In the second category, there are people who have surplus money and this surplus money when transferred or channelized to the weaker and marginalised section then they can do some productive work for the welfare of the society.
Earlier, there was a system of direct finance because people lived in small localities and most of the people were known to each other but later on it was done through intermediaries called agents. It is simply because of the finance and of course with modern technology and dexterity there has been rapid development. This development could not have taken place without finance. Now, the onus for all of us is how to keep up the pace with the development by remaining within the framework of Islamic principles (Islamic finance).
On historical note, the system of finance and its ways and means was there for a long time. The Prophet (peace and blessings of Allah be to him) only asked to avoid unfairness, refrain from Riba and abhor gambling. Our financial system should be based on justice, equality and detest from unfair means and practice.
Dr. Siddiqi also elaborated the indirect implication of Riba or unfair practices. There is mad race to earn more money in order to make profit for self after paying interest money or Riba. In this process, the resources are being exploited which has resulted in global warming and ecological disturbance.
Dr. Siddiqi also said how America in recent past created artificial uncertainty by feeding 7 billion dollars into international market without any backing against it and then pulled out all that money which created crisis and increased the value of dollar against Indian rupee and it can be said to be a classical example of unfair practices and created uncertainty.
Dr. Siddiqi also emphasised that in order to make Islamic principles readily acceptable to people of different faiths we have to rehabilitate our image on the principles, ideals and teachings of Prophet (peace and blessings of Allah be to him) because people are sceptical to adopt our concept even if it is feasible and lucrative. He also urged to rebuild faith and trust of others to propagate Islam and its principles.