Dar vows to promote Islamic banking

Federal Finance Minister Senator Ishaq Dar co-chaired the 6th meeting of the steering committee for the promotion of Islamic Banking here on Wednesday. Dar reviewed the progress made by the committee and was informed about the pressing issues faced by Islamic banks. He promised to provide Islamic banks level play ground to compete with conventional banks.
He stated that when Euro bond issue was oversubscribed more than 14 times, the government could have taken $5 billion but we only took up $2 billion so that additional financing could be done by issuing Sukuk, the Islamic mode of financing. The Finance Minister acknowledged that Islamic banking is growing globally and noticed the keen interest of countries such as the United Kingdom which want to make London as the hub of Islamic finance. He recalled that when he attended the Global Islamic Banking Forum in London with Prime Minister Nawaz Sharif, UK Prime Minister David Cameron announced the issuance of sovereign Sukuk for the United Kingdom.
He noticed that in Pakistan Islamic banks have high level of liquidity with lack of investment opportunities in providing finance to the government on the same level as the conventional banks. He reviewed various proposals which have been developed by the committee members and SBP and promised to use these to meet further needs of the government. He advised Secretary Finance to make use of this mode to meet the government needs.
Dar informed the meeting that the country had made a significant improvement in economic achievements which have been acknowledged by international financial authorities. However, the current political upheaval has overshadowed these. Looking at the rebound of the stock market, he was optimistic that as soon as the current political situation is improved, the economic recovery will get back on track.
The Finance Minister appreciated that the Steering Committee is working through a number of sub-committees on Islamic Capital Markets, Hedging, and creation of Stock Exchange Islamic Companies' Index. The Committee is to submit its report at the end of the year. The committee was constituted and notified by the Government of Pakistan in December 2013 to develop Islamic banking and look into various shariah, regulatory and taxation related issues.