By TwoCircles.net Staff Correspondent,
Kochi: Former union minister and Janata Party president Dr Subrahmaniam Swamy has filed a petition in the Kerala High Court questioning the state government in the matter of the Islamic bank. The petition reportedly questions the approval given by the government to the state Industrial Development Corporation (KSIDC) for registering a financial institution which functions according to the Sharia laws. The petition demands a cancellation of the government order of October 14 that gives approval for the KSIDC.
The order reportedly states that the KSIDC would have 11 per cent shares in the proposed financial institution. In the answer given by the KSIDC to a person named TG Mohan Das as per the RTI, it has stated that it had begun measures to promote the Islamic financial institution. The answer also says that the institution would be functioning solely on the basis of the Sharia. The applicants to the CEO posts were asked to report before the Sharia Advisory Board. The Sharia is applicable to Muslims alone. If the government joins a financial institution that complies with the Sharia, it is like expressing favour towards a specific religion. However, the constitution of the Sharia Advisory Board is not yet clearly known. But it is assumed that Muslim scholars would be in it. The Constitution demands to consider all religions as the same. But the government order is a clear violation of the Articles 14 and 25 of the Constitution and so should be scrapped, says the petition.
The Kerala government has decided to set up a non-banking financial institution in the model of an Islamic bank in order mainly to attract the investments of the NRIs for the development of the state. The proposed financial institution would have a Sharia Advisory Board and would function as per the Sharia laws. A draft plan of the proposed institution was presented by T Balakrishnan, principal secretary to the state Industries Department, at a two-day seminar on Islamic banking held in Calicut in October. Mr Balakrishnan is also in charge of the proposed institution. Renowned NRI businessman Gulfar Muhammedali has been named the Chairman of the institution and a committee of 12 promoters has also been formed. The institution might require Rs 1000 crore as capital and is supposed to begin functioning by the middle of next year.