Islamic finance proves viability worldwide: Sheikh

The Islamic principles of finance have proved their viability worldwide as the Islamic banking and finance was growing at a rapid pace globally, Federal Minister for Finance and Economic Affairs, Dr. Abdul Hafeez Sheikh said on Tuesday.

“In the wake of recent global financial crisis and debt problem of the third world countries and the Euro Zone, the Islamic Banking and Finance has established itself globally and is growing at rapid pace,” the federal minister said while addressing the inaugural session of two day international conference on Islamic Business and Finance here.

The conference has been organized by Riphah Centre of Islamic Business (RCIB), a constituent institute of Riphah International University with an am to discuss the present state of Islamic business and finance and the ways this system could contribute to the stability and provide opportunities to the national and global economies.

The federal minister said that the size of Islamic Banking is expected to reach US$1.3 trillion worldwide in near future adding that at present more than 1,100 institutions were offering Islamic finance service across the globe.

The size of investments in Islamic banking system reached to Rs.424 billion till 2010 in the country he said adding the government was taking measures to encourage Islamic banking and finance.

He said that the Islamic banking was also very productive for the agriculture field which could take benefit of it, however urged the banks to extend their role and reach the farming community.

He highlighted the importance of modernizing the overall banking system of the country for the economic progress.

He said that the Islamic banks, coupled with a number of dedicated Islamic academic, legal, regulatory and supervisory institutions could provide a solid platform for future growth and development of the Islamic finance industry.

The federal minister called up the Islamic banking institutions to enhance awareness about Islamic banking products and develop human resource by facilitating and arranging training workshops, short-term courses and particularly offering post graduate academic institutions.

Speaking on the occasion, Vice Chancellor, Riphah International University, Dr. Anis Ahmed highlighted various aspects of the Islamic banking.

He said that the purpose of the conference was not only to discuss the present state of national and international economies but also to reflect our faith and belief.

He said that Islam was the complete code of life which also envisages economic needs, clearly differentiating between Halal and Haram.

Senator, Prof. Khursheed Ahmed while speaking on the occasion said that adoption of Islamic way of banking was the need of the hour adding that the Islamic banking and finance represents a change of paradigm.

He said that new approach was needed to change the fundamentals of finance to evolve a new financial and economic system and urged upon the participants of the conference to revisit the fundamentals and realize the importance of Islamic banking and finance.

It is pertinent to mention here that this was the first international conference being held in Pakistan on the subject. A large number of world-renowned economists and scholars from various countries are participating in the conference.