Mufti Sheikh Ravil Gaynutdin, the Chairman of Russia Muftis Council, appealed for active development of Islamic banking in Russia. According to him, there are many such financial institutions in Paris, in London, in Washington; they are opening in Germany and Belgium too.
In August 2014, the Association of Russian Banks (ARB) proposed to establish special Sharia Councilin the Central Bank, which would define the compliance of financial transactions of Islamic credit institutions to religious principles, Lenta.ru reminds.
Among the Russian banks Kazan “AK Bars” accomplished transactions under Sharia law.
Islamic banking is an alternative to traditional banking. Within its principles, it is forbidden to give out money on loan interest. Financial institution cannot provide funds and earn income from forbidden activities: production and sale of pork, alcohol, arms, gambling. All transactions must be approved by the Shariah Council, which is a part of the Bank.
Islamic banks operate on the principle of project financing — they invest in specific programs and organizations and receive income from equity participation in their development.
Correspondent of Regions.ru asked the representatives of the Higher and Lower Chamber of Russian Parliament to comment on the proposal of the Mufti.
VyacheslavvShverikas, Member of the Federation Council Committee on economic policy (Republic of Adygea): “In principle I am not against the development of Islamic banking in Russia, I would even welcome this direction.
On the other hand, Islamic banking, Semitic and other – all of them are participants in the overall international financial system, where money plays the main role. The money needs to make money, as Karl Marx, who derived the formula “money – goods – money stroke”, determined. Yes, Islamic banks also have some limitations, but money is money.
Today, to paraphrase Sergey Mikhalkov, we need all sorts of money and all sorts of money are important. So, let the money from the Middle East come to us . Nevertheless it is better to stay away from “criminal” money derived from the sale of weapons, drugs, but special department is hunting for it all the time, that’s why we have some protection”.
Sergey Batin, The Member of the Federation Council Committee on budget and financial markets (Republic of Tatarstan):
“Fully support. It is actually strange that we do not emphasize the importance of the Institute of Islamic banking in Russia. After all, this financial institution is not just for believers who could manage their own savings from the point of view of accumulation. Do not forget that Islamic countries – Qatar, Saudi Arabia, etc. have a large amount of finance and they are willing to invest it in the real sector of the Russian economy.
By the way, the head of the Administration of Islamic banking visited the Kazan summit-2015 in June, and then met with the Chairman of the Central Bank Elvira Nabiullina. However, unfortunately, further steps towards the development of this financial institution did not follow. Therefore, it is good that the Chairman of Russia Mufties Council spoke about this. I hope it will move from a dead point now.
The main advantage of Islamic banking is that money circulating in the systemcannot be invested in stock exchanges, stocks; they cannot develop alcohol business, tobacco. According to the Islamic laws, money can be invested in the real economy, namely in the construction and modernization of factories, in the construction of different kinds of enterprises, it is also possible to invest in the construction of residential buildings, hospitals, hotels. That is the Islamic banking guarantee evidently: the course of the shares is not permanent, quotes changes all the time: it is extremely difficult to plan the income from such activities. Otherwise, the real economy has not such “shakes” – it’s stable, fundamental. That is that the real economy will get benefits from the Islamic banking: so-called “Halal” money intends for it. As we know the development of the real sector of the economy is exactly that which our country needs now!
Finally: Islamic banking can be used by everyone, not just Muslims. Religion plays no role”.
Boris Kashin, the Member of State Duma Committee on financial market. The fraction CPRF:
“I believe that Gaynutdin, and representatives of other faiths, ought to focus on spiritual matters. If we talk about the banking system, now we need “soviet” banking. By this, I mean specific support borrowings of the real sector of the economy. Today I met in Irkutsk with local farmers, and they literally groan from the percentage that forced them by the current “capitalist” banking. The financing of the real sector, particularly agriculture, under a reasonable percentage and directly through the state banking system – that is what we really need.
According to the granting of funds under the loan interest, which is prohibited in Islamic banking, I would like to mention that the modern banking system based on it and the main principle is that money should make money. If Islamic banks do notwant to finance the development of pork farms no one force them. But the idea of bringing in our banking principles of Shariah law is unlikely to be discussed. It’s not such innovation that I would like to see today in our banking system. Muslim bankers have opportunity to take part in project financing even in the context of the current Russian legislation. In any case, the law should be uniform for all banks.
In principle, I attitude to the introduction of any religious conceptions not only to the state system, but also in economic practice with great caution. In my opinion, there is a possibility of very negative consequences. We have a secular state, and the issue of preserving the secular nature of the Russian society is very serious. So it seems to me that the idea of Gainutdin pulling us the wrong way”.
Anton Ishchenko, the member of State Duma Committee on budget and taxes. LDPR faction:”In my opinion, formulating of question is absolutely right.
There is a whole system of commercial banks, operating on the principles of Islamic Finance in the world. Huge amount of money involved for the implementation of major investment projects. To be honest, it does not matter for me, in which way does money issued: at interest or under the equity participation of banks in commercial projects. Again, if there is the additional possibility of funding any Russian projects, it must be used on the territory of the Russian Federation.We must remember that the Arab countries are among the richest, they have huge financial resources, which for a certain kind of political motives do not reach so far into the territory of our country.
Of course, we need to have control over the activities of Islamic banking, from the point of view of national security and national interests. Anyway, I do not see serious reasons to build insurmountable cordons for Islamic banks operating in the territory of the Russian state. Their activity can become a very serious resource for our economy to feel additional infusion of funds, received a boost for the recovery. I am sure that we will be able to seriously revive investment processes in our country with the help of Islamic banks”.
MuslimEco.ru based on Regions.ru