The Islamic Capital Market is an chance for the sustainable macroeconomic development of a state in the long term. The direct and indirect socioeconomic development impacts are even greater. It can promote new degrees of dynamism in the sector and pull more foreign direct investing and portfolio flows. As a affair of fact, this can assist smooth out disparities between degrees of fiscal development and capableness, every bit good as surrogate deeper regional ties in Africa. The planetary market for ICMs is comprised of more than 300 Muslim fiscal establishments and 80 takaful operators with assets over US $ 1 trillion. Furthermore, there are over 900 Shariah compliant financess worldwide valued at over US $ 850 billion and sukuk market is valued at more than US $ 90 billion. Even the market capitalization of Dow Jones Islamic Index, which is in a western state is of more than US $ 20 trillion.
About every state and fiscal Centre in the universe is viing for a prima place in the turning Islamic Capital Market, but it is by and large expected that each of them will obtain merely a portion of it. Sliting and sharing of the ICM pie is inevitable. Mauritius is positioning itself in this section which is considered as a niche concern. Everything started when the Bank of Mauritius ( BoM ) recognised the potency of Islamic Finance to convey diverseness to our fiscal markets, encouragement concern chances, and exercise a positive impact on the economic system. In October 2005, the authorities had set up a maneuvering commission to research the possibility of implementing the constitution of Islamic fiscal services. A study was finalised in June 2007 and this is when everything started, and the state had to locate itself.
Since October 2009, the BoM is a full member of the Islamic Financial Services Board ( IFSB ) and as such BoM joins the Monetary Authority of Singapore as the lone cardinal Bankss from non-Islamic states on the IFSB Council. It has been noticed that despite there has been consistent growing internationally, many supervisory governments and finance practicians remain unfamiliar with the procedure by which Islamic Bankss are introduced into conventional system ( Sole, 2007 ) . The BoM has taken it into history and cardinal Bankss, such as Bank Negara Malaysia and Bank of England amongst others, have been beginnings of inspiration. One has emerged as the Islamic finance human dynamo of the universe and the other is by far the most celebrated conventional fiscal sector. To cite what Mr. Rundheersing Bheenick the Governor of BoM said in a imperativeness conference, he added “ merely like the British FSA did over 11 old ages back, we steered our thought towards holding a regulative model that accommodates both conventional and Islamic Financial establishments. We have besides drawn counsel from the experience of other states which have embarked on Islamic finance but we have had to map our ain path. For case, we have opted non to enforce a individual Shariah on our fiscal establishments Board. We have left it to single establishments to put up their ain Shariah Committee and put up their ain Shariah experts. The Bank will recognize Shariah experts from reputable legal powers. ” The BoM has amended statute law and issued the necessary guideline. There have besides been a Memorandum of Understanding signed between the latter and Financial Services Commission ( FSC ) to guarantee that there is no regulative overkill. In May 2009, there have even been an international seminar on ‘Islamic Capital Market ‘ organised by the BoM in coaction with the FSC, and IFSB.
Refering products/services being offered in the market, among the first probationary stairss in Islamic finance the state has a esteemed planetary name such as HSBC Amanah which has included Mauritius in its planetary scheme and which is available to the planetary concern, to back up in the aspiration to place Mauritius as a legal power of pick for world-class Islamic fiscal services. It comprises of the undermentioned characteristics:
Amanah Current history
The current histories for concern clients are runing histories designed to fulfill all basic concern banking demands. Whilst offering the convenience and security of a regular current history, they besides provide the confidence that the financess deposited will non be used to put in non-Shariah compliant assets.
Amanah Term Investment history
The investing accounts stand for a short to medium-term investing solution for concerns to gain returns through a Murabaha contract. The financess will be invested in trade goods, which can be sold to the bank in exchange for net income payable at a pre-determined investing period/tenor.
‘BAI Takaful Unit Linked Plan ‘ is another merchandise from the British American Insurance ( BAI ) that pools investings from different unit holders. Its investing fund options are as follows:
Equity Fund ( aggressive ) A
Invest in a pool of companies and you will be rewarded through dividend and capital addition.
Trade Finance Fund ( moderate )
Become spouse in undertakings of companies at pre-agreed portion rates. You willA have your portion of the net incomes realised from those undertakings.
Finally, Islamic leasing called Ijarah is the other merchandise offered by Mauritius Leasing for both single and corporate clients as an option to traditional leasing. Harmonizing to the company the merchandise has been approved by the Shariah board supported by local and Malaysia-based bookmans who are to the full versed in Islamic finance.
There has been a bank named ‘Deen Banking Corporation ‘ which has been granted licence to run in the state and it will shortly get down its activities. It will be the lone bank in Mauritius offering entirely Islamic fiscal services.
It is concluded from the above statements that Mauritius has made a good start. However, we can non be to the full satisfied as it is still at its debut phase. It has many challenges waiting in front and at that place necessitate to be market growing. If the stakeholders of Islamic finance continue to work hard in all sector such as relation to ordinance governments, merchandises development, market development, consciousness programme, institutional and legal model countries so our ICM will keep a respectable place internationally.