- The bank will be established under Minority Cultural Coordination Committee
- It will comply with sharia laws and will refrain from investing in certain industries
- The Reserve Bank does not permit to Islamic Bank under existing laws
Kerala government had embraced Islamic Banking in a big way in his budget, and the CPM is planning to launch country’s first sharia-compliant banking institution in Kannur. The party is planning to open a cooperative bank that will comply with sharia laws.
Like other Islamic banks, the institution will not pay interest on deposits or charge interest on loans. It will follow a code of ethical financing and refrain from investing in industries that are considered harmful for Islam like gambling, liquor and pornography.
The bank will be established under Minority Cultural Coordination Committee. The cultural committee consists of several organisations and trusts working to uplift minority communities. CPM will support the endeavour.
Though previous UDF government made a proposal to Reserve Bank, they denied permission citing legal issues. The Central Bank states that existing laws does not permit Islamic banking in India and the Union Government will have to introduce new laws.
However, CPM is hoping to introduce Islamic Banking under cooperative banking laws on which state government can take a decision.
Last Updated 31, Mar 2018, 6:41 PM IST