ISLAMABAD: In a major step towards the Islamisation of Pakistan’s banking sector, the government has appointed reputed Islamic scholar Maulana Justice (retd) Taqi Usmani as Chairman of the Sharia Board of the State Bank of Pakistan.

In addition to this, Saeed Ahmad, chairman of the recently constituted steering committee to promote Islamic banking, is also being appointed as Deputy Governor of the State Bank of Pakistan to ensure that the conventional banking system is replaced by the Islamic banking system as per the teachings of Islam and in line with the provisions of the 1973 Constitution.

Justice (retd) Taqi Usmani, a leading scholar of Islam and a globally recognised expert on Islamic banking, when approached told The News that he had accepted the responsibility following the government’s assurance to promote the Islamic banking system so that the conventional riba-based system is replaced.

Justice (retd) Taqi Usmani expressed his satisfaction over the role assigned by the government to Saeed Ahmad, who is an actuary, has vast experience of Islamic banking and is a graduate of the London School of Economic, UK, and Harvard University, USA.

Only recently, Yaseen Anwar, Governor SBP, in his speech for the promotion of Islamic Banking had said that Pakistan, with more than a 95 percent Muslim population, and a constitutional obligation of ensuring a riba-free economic system, has had a favourable response to Islamic finance.

He said Pakistan is amongst the pioneers of Islamic finance as we started planning for nurturing the Shariah compliant financial system way back in the 1970s, and made a bold attempt in the 1980s to bring the whole banking and financial system in conformity with Shariah principles.

He added that the pioneering work of the 1980s, particularly on the legal and regulatory front, has been a source of guidance and inspiration for many countries that initiated Islamic finance in the 1980s and 90s.

The governor SBP said

that Islamic finance during the last four decades has witnessed considerable progress at the global front. Besides the traditional Islamic finance markets of the Middle East, financial centers across various Western countries are also accepting and recognising the viability and utility of this alternate financial system.

Sources said work is also under progress to Islamise the already announced Rs100 billion loan scheme for the youth of this country. Maryam Nawaz, Chairperson of the newly launched Rs100 billion Youth Business Loan scheme, had informed The News a few weeks back that these loans would be offered through a Sharia compliant scheme.

The sources said that at present, the National Bank of Pakistan and Meezan Bank are closely working on a system whereby the youth loan scheme is converted into an interest/riba-free Islamic loan scheme.

