For Urgent attention of the participants in 7th International Conference on Islamic Economics
Going by the past experience it can be said that during this conference loud claims will be made that great advances have been made in Islamic economics and banking where as there is yet no sign of any action having been taken on the deliberations of First Conference on Islamic Economics held 32 years ago. If Islamic economists holding responsible positions in prestigious institutes like IDB, IRTI, Islamic Foundation UK and IIIE Islamabad, had fulfilled their official, moral and religious duty ‘a system of interest-free banking, not as a supplement to but as a substitute for the prevalent system of banking’ would have replaced interest-based banking and interest would have been banned in Muslim countries long ago. Interest remains lawful and interest-based banking prevails in Muslim countries unabated. Many so-called Islamic banks are prospering on Islamic sentiment of their Muslim clients. They defy Islamic principle Al-Kharaj bi-al-dhamaan and earn disguised interest in the form of fixed returns from risk-free fake Murabaha transactions. They exclude pure loans from banking operations and for meeting their own short-term needs of liquidity they take loans on interest and also earn interest on their excess liquidity.
The writer took up the matter of shortcomings and defects in Islamic banking personally with IDB president during 4th Conference on Islamic Economics in August 2000. IDB letter of 2nd October 2000 advised the writer “Referring to the documents submitted to H.E. The president of Islamic development Bank (IDB) about your observation on the Islamic Banking movement, we appreciate very much your good efforts and insights. The Islamic Banks’ office of IDB will try to do its best to communicate to the Islamic Banks the shortcomings that you had mentioned in your document.” Islamic banks have not so far moved an inch towards achieving their avowed objective of getting Muslim Ummah rid of interest.
Participants of this conference are requested to give serious consideration to the contents of the attached 6 page document ‘Top Priority issue that must be tackled by 7th International Conference on Islamic Economics’ and do whatever they can to get Muslim Ummah rid of interest without delay noting that Muhammad saws said that those who do not care about the affairs of Muslims are not from amongst us.
Wassalam,
Encl: 6 page Document ‘Top Priority issue that must be tackled by 7th International Conference on Islamic Economics’
29th March 2008