Islamic finance has the potential to tackle poverty, boost prosperity: Ishaq Dar

May 30, 2023 (MLN): Islamic finance has already become mainstream, parallel to the global financial system, and has the potential to tackle extreme poverty and boost shared prosperity, Senator Muhammad Ishaq Dar stated in his keynote address during Pakistan’s first international conference on Islamic Capital Markets on Monday.

He said that "Pakistan has a strategic plan in place to grow Islamic finance."

Ishaq Dar added that we have a financial inclusion strategy that covers all the components needed to create Islamic financing.

H.E. Sh. Ebrahim Bin Khalifa Al Khalifa, Chairman, the Board of Trustees, AAOIFI, said in his keynote address that the principles of Islamic capital markets foster social and economic development and support sustainable growth, job creation, poverty alleviation, and the overall well-being of communities.

He reiterated AAOIFI’s overall commitment to the Islamic finance industry of Pakistan, as well as its capital market, and assured AAOIFI’s full support for improving the quality of AAOIFI standards implementation in the country.

SECP Chairman Akif Saeed, in his speech said that a calculated approach is needed to transform all segments of the financial system to transform into a complete Islamic ecosystem.

While highlighting key reforms introduced by SECP in recent years within the sphere of Islamic finance, he assured the audience of SECP’s complete committed to transform its regulated sectors in accordance with wishes of people of Pakistan as embodied in the Constitution.

He further laid down priority areas of SECP, which include focus on promoting product development & innovative solutions, implementing international best practices in governance and ethical standards, enhance capacity building through collaborations, and strengthen the legal and regulatory frameworks for Islamic finance.

SBP Governor Jameel Ahmed communicated the central bank’s commitment to transforming the financial sector into a shariah-compliant system.

He mentioned that SBP and SECP, as part of the federal government's steering committee, are playing their roles in achieving the aligned goals for the transformation towards an Islamic economic system.

On the topic of Islamic fintech, experts agreed that in the fast-changing dynamics of the market, propelled by technological advancements and the growing demand for innovative products that cater to emerging sectors, tech-based products and services need special focus and facilitation.

The event was organized jointly by the Securities and Exchange Commission of Pakistan (SECP) and the Accounting and Auditing Organization for Islamic Financial Institutions (AAOIFI).

The theme of the one-day conference was "ICM development with ecosystem completion: innovation, growth, and transformation".

The conference was supported by the Asian Development Bank (ADB), Pakistan Stock Exchange (PSX), National Clearing Company of Pakistan Limited (NCCPL), Central Depository Company (CDC), Almeezan Investments, and other leading industry players in the non-bank financial sector.

Participants unanimously resolved that all stakeholders must work together for the shared prosperity of the Muslim Ummah through the development of a sustainable and efficient Islamic financial system.

The event was a resounding success, bringing together prominent speakers from Bahrain, Turkey, Malaysia, the UAE, and the UK, in addition to local industry experts, scholars, and practitioners.

There was a broad consensus that a strategic development plan needs to be introduced and implemented for the organized development of Islamic finance across all sectors.

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