ISLAMABAD: The government on Friday constituted a 14-member steering committee comprising religious scholars, bankers, chartered accountants and industrialists to provide a strategic direction for elimination of Riba within a five-year deadline set by the Federal Shariat Court (FSC).

Under the ‘patronage’ of Finance Minister Ishaq Dar, the committee will have eight private sector members and five ex-officio members from the government side, according to a notification issued by the finance ministry.

The private sector members include Maulana Mufti Muhammad Taqi Usmani, President of Wifaqul Madaris; Mufti Irshad Ahmad Aijaz, Chairman of Shariah Advisory Committee of the State Bank of Pakistan (SBP); Mansurur Rehman Khan, President and CEO of Institute of Bankers Pakistan; Ashfaq Tola, Chairman of Pakistan Reforms and Resource Modernisation Comm­ission, Khozem A. Haidermota, Senior Partner, Haidermota & Co, Saeed Ahmad, former deputy governor of SBP, Irfan Siddiqi, President, Meezan Bank and Mian Muhammad Adrees, CEO, Sitara Chemical Industries.

The ex-officio members include SBP governor, deputy governor of FIDFS & IT SBP, finance division secretary, chairman of the Securities & Exchange Commission of Pakistan and Pakistan Banks Association chairman.

Under the terms of reference, the steering committee would provide strategic guidance on the legal and regulatory reforms and actions required for implementation of FSC’s verdict on Riba. It would also suggest capacity-building measures of the stakeholders for full implementation of the FSC’s decision and monitor the progress of implementation of the FSC’s judgment, and remove the bottlenecks.

Finance Minister Dar announced in November the government’s decision that the SBP and the National Bank of Pakistan would immediately withdraw appeals against the FSC order for complete elimination of Riba (interest) by transforming banking in the country by Dec 31, 2027 as required under the Holy Quran and Sunnah.

The FSC in its April 28 order also directed the federal and provincial governments to complete the necessary legislation and bring all laws into conformity with the injunctions of Islam by 2027 deadline and adopt to Shariah compliant modes in future while borrowing from domestic or foreign sources.

While the SBP, NBP and three leading private commercial banks — MCB, United Bank Limited and Allied Bank Limited — had challenged the FSC decision in the apex court, the SBP and NBP withdrew their appeals later.

Minister of State for Finance Aisha Ghaus Pasha earlier testified before a parliamentary panel it was clear that everything would not be converted to 100pc Islamic system within five years, because the country and its financial system were internationally integrated but there was a lot of appetite for Islamic system among the majority population as some multilateral institutions were also using such products.

Published in Dawn, December 24th, 2022