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Today, India is home to 155 million Muslims, with many living in deep poverty. Historically, the response from the Indian public and private sector has been lukewarm towards the development of Islamic banking. However, pressure is building on the government, from a private sector level, to provide a conducive environment for the industry.
Key Developments
Feb. 2008: Standard and Poor's (S&P) announces the launch of two Shari'ah complaint indices for the fast growing Indian equity market.
Dec. 2007: HSBC and Kuwait Finance House (KFH) join forces to arrange one of the first Islamic project finance initiatives in India, with a $50m Ijarah facility. This facility allowed the client to purchase machinery equipment for its leasing business.
Sep. 2007: Indian Bankers Association (IBA) claims Islamic banking is "an idea, whose time has come". The IBA went on to say that it was imperative for the Indian government to establish the relevant legal framework for the industry to thrive.
Aug. 2007: Bahrain's Albaraka Banking group highlights India as a key growth, after unveiling record profits.
Jul. 2007: France's Velcan Energy aims to raise €200m using Islamic bonds, with the aim to build hydroelectric dam in India. In addition, around 600 million people live with no reliable supply of electricity; with the government playing an active role, the energy market in India is certainly attractive to Islamic investors.
Jun. 2007: Al Amin Bank, of Bahrain, launches a new Shari'ah fund. The aim is to capitalise on the surge in investor interest in the Indian market, across the Middle East.
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Key Statistics
Population
1.13 billion
- 80% Hindus
- 13.4% Muslims
- 2.3% Christians
- 1.9% Sikhs
Economy
GDP: $1 trillion
- GDP per capita: $978
- Population below poverty: 25%
- Labour: 510 million
- Main Industries: textile, steel, cement, transportation equipment, mining, software.
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