‘The development of skilled human resource base is critical for sustainable growth of Islamic finance industry in Pakistan,’ said the Federal Minister for Finance Senator Muhammad Ishaq Dar. He made these observations while speaking as the chief guest at the launching ceremony of the third Challenge Round of Financial Innovation Challenge Fund (FICF) on ‘Promoting Excellence in Islamic Finance’ program, which is being funded by UK Aid and implemented by the State Bank of Pakistan (SBP) as part of Pakistan Financial Inclusion Program.
Leading business schools and universities of the country were also invited to this challenge round for the establishment of a “Centre of Excellence for Islamic Banking and Finance”. Centre of Excellence will ensure supply of qualified and trained human resource to the Islamic Banking and Finance Industry. Interestingly, all major universities and business schools are now considering to introduce degree courses in the specialized subject of Islamic Finance specially following increasing demand for skilled man power within the country and abroad.
The eventual aim of the FICF Round was to establish Islamic finance education and research infrastructure in partnership with leading higher education institutions in Pakistan to serve the Islamic finance industry in meeting its growing human resource and knowledge requirements through quality and value added services and knowledge products.
Jan Wimaladharma, Team Leader of the UK Department for International Development, Pakistan, and Prof. Dr. Mukhtar Ahmed, Chairman Higher Education Commission also spoke on the occasion.
It will not be out of place that the Islamic Finance Industry has succeeded the attention of the international players in the financial sector due to its rapid growth rate of 20 percent not only in Pakistan but elsewhere in the world and the best example is the London Islamic Financial Center, which had succeeded a deposit base of over $22 billion in 2013. However, the Islamic Finance Industry is confronted with two major issues internationally including demand growth of skilled manpower and the investment avenues for productive use of accumulated deposits in accordance with Shariah-compliance.
These challenges can be and should be taken as a blessing in disguise to make all out efforts to turn them into an opportunity by producing skilled man power in this specialized area of financial management besides developing Shariah-based industries to put the accumulated liquidity with the Islamic Financial Institutions.
Meanwhile, the Finance Minister Senator Ishaq Dar has said that the partnership between Department for International Development (DFID), UK and SBP for promotion of financial inclusion has further strengthened the bond between the two countries. Congratulating the State Bank and the UK Government, he hoped that the initiative will go a long way in promoting inclusive economic growth through provision of demand-driven innovative financial services for un-banked population particularly the low income households and rural entrepreneurs.
Expressing his views on the establishment of Centre of Excellence for Islamic Finance, Ashraf Mahmood Wathra, Governor State Bank of Pakistan, said that the establishment of this Center of Excellence would contribute significantly towards developing a more inclusive Islamic financial system leading to financial products with a closer link between finance and real economic activity. He also believed that the Centre would serve to provide Shariah-based solutions for financing needs of all segments including the government and monetary policy instruments for the central bank. He said that since financial exclusion was quite pronounced in Pakistan, both the government and the State Bank of Pakistan were making efforts to address the challenge using innovative approaches and actions. Emphasizing the full commitment of the government to provide sustainable financial access to the under-served economic and geographic segments including youth, women, and SMEs, Mr Wathra said that the role of multilateral institutions and bilateral donors particularly the UK Aid has been critical.
Mr. Saeed Ahmad, Deputy Governor SBP, emphasized the importance of knowledge and education in light of teachings of Quran and Sunnah. While speaking at the event, Mr. Saeed Ahmad affirmed SBP’s vision to flourish Riba-free economy in Pakistan. He assured that government and the central bank were committed for promotion and development of Islamic financial industry through innovative solutions that are not only Shariah-compliant in the form but also in line with the Maqasid-e-Shariah. An independent FICF Advisory Committee, drawing representation from DFID, HEC, private sector, and the SBP, will review and approve the challenge round winners.
Meanwhile, a study conducted by the State Bank of Pakistan has established the demand for Islamic banking at all level but at the same time revealed the lack of awareness not only among ordinary people but even among qualified and educated groups.
Deputy Governor, State Bank of Pakistan (SBP), Mr. Saeed Ahmad while launching the second phase of media campaign for promotion of Islamic banking in Pakistan last week said that the main theme of second phase of this campaign is education and awareness of Islamic banking. Through this campaign people would be able to know the basic principles of Islamic banking and this would further translate into growth of the industry.
The awareness campaign will stand on preparation of documentaries on Islamic Finance explaining basic concepts, practices and also address the general misconceptions, Intensive use of print media for dissemination of basic Islamic banking concepts, Engaging electronic media for initiating talks on Islamic banking and finance by renowned Islamic finance professionals, highlighting value proposition and Shariah-compliance of Islamic banking and dissemination of the brochures and pamphlets containing answers of some of the common questions about Islamic banking by public at large.