‘40pc of world’s Shariah-compliant financial experts hail from Pakistan’

KARACHI: Pakistan has firmly established itself as a key player in the global Islamic banking sector, with nearly 40 percent of the world’s Shariah-compliant financial experts hailing from the country.

This recognition comes from Sheikh Ibrahim Khalifa Al Khalifa, Chairman of the Accounting and Auditing Organization for Islamic Financial Institutions (AAOIFI), highlighting Pakistan’s growing influence in shaping the future of Islamic finance worldwide.

Addressing at a reception hosted by Islamic Banks of Pakistan on Tuesday, Sheikh Ibrahim Khalifa Al Khalifa praised Pakistan’s contributions to Islamic banking, saying that Pakistan has become a global focal point and leading emerging market of the Islamic Banking Industry.

The event was attended by several notable figures of the banking industry including Mufti Muhammad Taqi Usmani, Jameel Ahmed, State Bank of Pakistan (SBP) Governor, Dr Ishrat Husain, former governor SBP, Yousaf Hussain, President Faysal Bank, Irfan Siddiqui, President Meezan Bank.

Sheikh Al Khalifa highlighted Pakistan’s leadership potential in the field, recognizing the country’s large pool of Islamic banking experts and their efforts to strengthen the Shariah-compliant financial system worldwide. He stressed the importance of extending the benefits of Islamic finance to underserved communities while addressing the challenge of promoting social justice through the industry.

Reflecting on Pakistan’s economic progress, Sheikh Al Khalifa commended the country’s rapid efforts to control inflation, stating that such progress is noteworthy compared to similar economies.

Muhammad Taqi Usmani underscored the importance of standardization in Islamic banking, crediting AAOIFI with issuing more than 70 global standards for Islamic financial institutions. He acknowledged Pakistan’s progress in eliminating interest-based financial systems and noted that the country’s parliament has set a timeline to achieve this goal.

He also emphasized that Islamic banking must align with the Quranic principles and ensure equitable wealth distribution and social justice, addressing challenges such as the misuse of wealth.

Jameel Ahmed, Governor SBP highlighted the global growth of Islamic banking, which has reached $3.7 trillion and stressed the importance of developing local Islamic financial systems.

He shared details of a high-level steering committee formed to advance Islamic banking in Pakistan. Highlighting key challenges, including the transition of government debt instruments from conventional to Islamic structures, he called for innovative solutions to ensure sustained growth.

Jameel Ahmed emphasized the need for an interbank Islamic market and liquidity management tools to support the industry, along with raising awareness and training skilled professionals.

Former SBP governor, Dr Ishrat Husain emphasized the transformative potential of the Islamic financial system in addressing key societal challenges. He said that Islamic finance should actively promote social justice and work towards poverty elimination, aligning with its core principles of fairness and equity.

He urged the Islamic banks to focus their investments on areas that can significantly impact communities. He highlighted the importance of supporting Small and Medium Enterprises (SMEs), empowering farmers, facilitating affordable housing, and the promotion of education. These sectors, he said, are necessary for sustainable economic growth and social development.

Copyright Business Recorder, 2024