For Muslims hesitating to invest for the fear of breaking Islamic principles on money, the Kerala government offers a way out
Funds for infrastructure projects, and Shariah-compliant investment opportunities for Keralite Muslims — with one stroke, the Kerala government has come up with a solution for these two problems.
The state government is in the process of setting up a Rs. 1,000 crore investment company that will offer equipment leasing and home loans, and invest in Islamic compliant ways. This will be India’s first government-controlled Islamic company.
The How
Ijarah
A finance company buys an asset and leases it out to users for a fee. The asset must be used by Shariah compliant companies and both parties should know what it is being used for.
(This story appears in the 09 October, 2009 issue of Forbes India. To visit our Archives, click here.)