Islamic Bank in India to get Green Signal
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9 February 2011Prathima Rajan
The Kerala high court recently dismissed a petition objecting to the creation of an Islamic financial institution and said the proposed body was to work in accordance with financial laws of the country even while it complied with Shariah rules. The move could pave the way for introduction of Islamic finance products by existing lenders and also reduce regulatory objections for an Islamic Bank. The conventional Indian banks have welcomed Islamic banking and finance take roots in India with the second largest Muslim population in the world (over 150 million). This has certain set of apprehensions about whether Islamic finance has any future in this country with an avowedly secular constitution. While regulators make way for Islamic banks in India the big question is about the responsibilities associated with it for the advocacy groups to move ahead and lay a solid foundation for introduction of Islamic finance in India keeping in line with Shariah principles. The dearth for Islamic scholars should not put the task of Islamic banking into wrong hands repeating in the blunders committed elsewhere of bringing in the "corrupt and spurious" products and models of some so-called Islamic banks. It is also of at most important to focus on organic growth with out being over ambitious, resulting in dilution of Shariah laws. The point of concern is the awareness of the concept of Islamic banking even with in Muslims with in the country is very low which will result in delayed acceptance and this is where educating the customers comes into picture.