By TwoCircles.net staff reporter,
New Delhi: The Indian Union Muslim League (IUML) has submitted a memorandum with the Planning Commission of India urging it to promote interest-free banking in the country. The monetary system should be based on profits, not interest, the organization demanded.
That kind of financial system is what is called Islamic finance and Islamic banking. IUML president Ghulam Mahmood Banatwala submitted the memorandum with the Planning Commission’s committee for monetary system reform set up to suggest ways to reform the system.
Headed by Raghuram Rajan, member of the Working Group for the formulation of Tenth Five Year Plan (2002-2007), the committee submitted its draft report in April this year and has asked public to come up with suggestions. After going through those suggestions, the committee will present its final report.
In the memorandum, Banatwala said that interest-free monetary system will open a floodgate of investment from Gulf region and other Muslim countries. That system will also attract hundreds of millions of Muslims in India also because interest is prohibited in Islam. The profit-based system has been a hit in the Muslim countries. It has helped them keep the annual rate of development between 15-20% and register the investment of Rs 30 trillion US$.