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Pakistan's state-owned Power Holding announced the 10-year Sharia-compliant sukuk up to Rs200 billion through the Pakistan Stock Exchange. The amount generated from the Pakistan Energy Sukuk-II will also be used for the settlement of partial circular debt related to the power sector. For the first time, ordinary investors have been allowed to participate in buying a government security. The value of each sukuk unit is placed at Rs5,000. The minimum bid size would be 20 units or Rs100,000. In another development, the SECP has relaxed the time for maturity requirement of government Ijara Sukuk for Sharia-complaint money market sub funds of Pension Fund. The SECP has allowed the Sharia-compliant pension funds to invest in government sukuk from three to five years.

The State Bank of Pakistan (SBP) has issued the auction calendar for issuance of Rs225 billion sovereign Sukuk based on Ijarah. Pre-auction target is set at Rs75 billion for April, while similar amounts are set for May and June 2020. The latest issuance is the part of Rs700 billion worth Ijara Sukuk. The federal cabinet approved the launching of this bond early this month. The bond would help mobilise excessive funds available with Islamic banks and help the government to diversify its debt. Last week, the World Bank said the economic output was expected to contract sharply in Q4FY20, bringing overall FY20 growth to negative 1.3%.

The State Bank of Pakistan (SBP) announced the auction for three-year Ijara Sukuk to raise some Rs 225 billion for the federal government. Recently, the federal cabinet approved the issuance of a five-year Ijara Sukuk to generate some Rs700 billion to meet the rising financial requirements for combating COVID-19. Three tenders will be conducted for the sale of the Rs 225 billion sukuk. The first auction will be held on April 16, 2020 for Rs 75 billion, the second on May 16 for Rs 75 billion and the third is scheduled for June 18, 2020 for Rs 75 billion. Pakistan has been issuing Sukuk since 2008 to provide liquidity to the domestic Islamic industry; however, demand for such instruments far surpasses their supply.

The first batch of the much-needed medical supplies donated by the Jack Ma Foundation and the Alibaba Foundation has arrived in Pakistan. The shipment is part of the donation of medical supplies to 10 Asian countries announced on March 21. Collectively, the nations will receive a total of 1.8 million masks; kits for testing 210,000 people, 36,000 pieces of protective clothing, as well as essential medical equipment such as ventilators and forehead thermometers. Pakistan's Disaster Management Authority will transport and distribute the supplies throughout the country. The remainder of the donation is expected to reach Pakistan soon.

Al Rayan Investment is working on the requirements of authorising a new bank with an expected paid-up capital of $10mn and an authorised capital of $20mn. The new bank is intended to be the first full-fledged digital bank in the Astana International Financial Centre (AIFC). Adel Mustafawi, Group CEO of Masraf Al Rayan said that Kazakhstan represents a new hub for Islamic finance in Central Asia, which offers considerable potential; while AIFC represents the optimal platform for Al Rayan. AIFC governor Dr Kairat Kelimbetov welcomes the decision of Al Rayan Investment to establish a fintech bank in AIFC. The new digital bank will focus on the development of Islamic banking products and investments facilitated by the application of cutting edge fintech products.

Meezan Bank's Shariah Board endorsed new guidelines related to digital accounts, supply chain financing and a housing finance facility. The Shariah Supervisory Board showed its overall satisfaction on the Shariah-compliance environment and operations of the Bank. Guidelines for the digital Meezan Asaan Mobile Account based on Mudarabah were approved during the board meeting. From now on a customer can open his digital mobile account at Meezan Bank without the hassle of visiting any physical branch. The customer will be entitled to receive halal profit based on actual returns of Shariah-compliant financings on monthly basis. Furthermore, the customer can use this account to deposit and withdraw funds digitally or from any Meezan Bank branch all over Pakistan.

A high-level delegation of the Islamic Development Bank (IsDB) and Lives and Livelihoods Fund (LLF) re-affirmed their commitment to support Pakistan in their fight against polio. The LLF has prioritized the eradication of polio and contributed over US$ 100 million to the Pakistan Polio Eradication Programme. During the visit, the LLF and IsDB team visited the outskirts of Islamabad Capital Territory and participated in the nationwide vaccination campaign which started on December 16, 2019. During this campaign 39.5 million children under the age of five were vaccinated. The LLF is the largest development initiative of its kind and donor partners include the Abu Dhabi Fund for Development, the Bill and Melinda Gates Foundation, the Islamic Solidarity Fund for Development, the King Salman Humanitarian Aid and Relief Center and Qatar Fund for Development.

At the ongoing Kuala Lumpur Summit 2019, leaders of the Muslim world have pressed for alternative currency for use in trade and seek independence from US Dollar. Turkish President Recep Tayyip Erdogan said Muslim countries should try to create new transaction systems. He added that Islamic finance needs to be part of the agenda just like in Malaysia. Meanwhile, Iran's President Hassan Rouhani was of the view that Muslim nations should come up with a new own cryptocurrency. Malaysia's Prime Minister Tun Dr Mahathir Mohamad also believes that a united cryptocurrency is needed for Muslim states, as a cryptocurrency can cut through bureaucratic and market fluctuations. He added that utilising cryptocurrency or national currency would help attain independence from over-reliance on the US dollar.

Assets worth over Rs 10 crore of a Bengaluru-based firm have been attached under the anti-money laundering law in connection with an alleged 'Islamic banking or halal investment' ponzi scam case. The accused firm is Ambidant Marketing Pvt Ltd and the case had made headlines last year in Karnataka. The firm is accused of collecting investments from customers under the Haj/Umrah plan in the name of 'Islamic banking or halal investment' and offering huge returns to the extent of up to 15% per month. The company was not authorised to collect such funds as it was neither registered with RBI nor with the SEBI under their collective investment scheme. The company had hired agents who would convince investors to invest in the plan by giving these agents a heavy commission. Initially, the company shared profits to the existing investors out of funds obtained from its new investors.

Pakistan sought financial and technical assistance from Islamic Development Bank (IDB) to establish an export-import bank to improve trade among Muslim economies. International Islamic Trade Finance Corporation (ITFC) is an autonomous body under the Islamic Development Bank that aims to promote trade to improve the economic condition of the people of Muslim countries. Minister for Economic Affairs Hammad Azhar said ITFC has provided financing facility to Pakistan to cover its oil and liquefied natural gas imports over a period of three years. Furthermore, he asked ITFC to develop training tools in Islamic banking as Islamic banking is very popular in the country.

Nearly 17 years after its entry into Pakistan’s financial space, Islamic financing has grown considerably. Its acceptance has cleared up the initial mist, scepticism and suspicion associated with the concept. The effort to introduce Islamic banking started in early 2002 with the granting of licence to the Meezan Bank. The growth has resulted in five full-fledged Islamic banks namely Meezan Bank, Al-Baraka Bank Pakistan Limited, Dubai Islamic Bank, Bank Islami Pakistan and MCB Islamic Bank. Many conventional banks are also operating Islamic banking branches. However, there is still a low level of awareness about opportunity and economic benefits. Pakistan's present government has decided to initiate a comprehensive plan for the promotion of Islamic banking in the country.

Pakistan's government seeks the International Monetary Fund's (IMF's) nod for issuance of fresh Sukuks worth Rs 200 billion. IMF's Review Mission is expected to reach Islamabad on November 28, 2019 to evaluate implementation on targets agreed by the Government of Pakistan for $ 6 billion facility. Minister for Power and Petroleum, Omar Ayub Khan last month stated that expensive power sector loans are being replaced with Sukuk which will lessen the financial impact on the economy. Pakistan's circular debt is about Rs 1.6 trillion and the new sukuk is meant to reduce the stock of this historic circular debt. The issue of sovereign guarantee for fresh Sukuks of Rs 200 billion has been raised with the State Bank of Pakistan. Meezan Bank, Faysal Bank, Bank Islami Pakistan, Dubai Islamic Bank Pakistan, MCD Islamic Bank and Al Baraka Bank Pakistan are the mandated lead arrangers.

The federal government of Pakistan has decided to initiate a comprehensive plan for the promotion of Islamic banking in the country. The National Assembly Standing Committee on Finance chaired by Asad Umar announced that the State Bank of Pakistan was in the process of formulating a seven-year plan and a comprehensive framework in this regard will be introduced within two months. The SBP officials gave a briefing to the committee about the Eradication of Riba Act, 2019. The chairman advised the standing committee on finance to expedite the work on the bill and constituted a sub-committee, headed by MNA Raza Nasrullah.

The Islamic banking and finance sector in Pakistan continues to be on an upward trajectory, with assets, deposits and the number of branches of Islamic banks all showing solid growth. According to the latest Islamic Banking Bulletin issued by the State Bank of Pakistan on September 13, assets of Pakistan’s Islamic banking industry stood at Rs2,992bn ($19.8bn) by June-end, 2019, a growth of 20.6% as compared to June-end, 2018.

The State Bank of #Pakistan issued an updated Islamic financing facility for the renewable energy projects. The financing under Islamic Financing Facility for Renewable Energy (IFRE) is now available to the customers under three categories. Under the first category, the prospective sponsors are setting up power projects with a capacity ranging from more than 1MW and up to 50MW for their own use, or sell electricity to the national grid or combination of both. The State Bank of Pakistan will make Mudarabah investment in general pool of Participating Islamic Financial Institutions (PIFIs) under IFRE. IFRE shall be effective immediately and financing shall be available for projects up-to June 30, 2022.

Dubai's Emirates NBD has coordinated a $500m Islamic law-compliant syndicated loan for the government of Pakistan. The loan was provided by a consortium of 12 banks and was oversubscribed by more than 40%. The consortium comprised Emirates NBD, Commercial Bank of Dubai, Noor Bank, Allied Bank, Dubai Islamic Bank, First Abu Dhabi Bank, Mashreq Bank, Sharjah Islamic Bank, Samba Financial Group, Bank of Jordan, Habib Bank Limited and Union De Banques Arabes Et Francaises. The loan was organised as a murabaha.

India is considering a ban on cryptocurrencies. A draft bill explains that a Digital Rupee, which will be issued by the Reserve Bank of India (RBI), would be approved as legal tender, while all other digital currencies would be prohibited. However, the ban does not apply to anyone using distributed ledger technologies (DLT) or other related technologies for experiments or research, as long as cryptos are not being used for payments. The proposed penalty for violating the ban would be a fine or up to 10 years’ imprisonment, or both. The news comes after reports that RBI has been developing a blockchain platform for banking in its R&D branch. However, RBI has denied it had any involvement in the proposed legislation.

Dr Muhammad Amjad Saqib, the founder of the Islamic micro finance company, Akhuwat, met with Alan Hatfield, executive director for strategy and development at ACCA London headquarters. In Pakistan, micro finance is proving popular amongst the growing SME sector. The country’s SME development authority calculates that nearly 90% of companies are SMEs, most of them operating in the informal sector, so the demand for micro finance is also growing. Akhuwat has opened over 850 branches in 486 cities/towns across Pakistan, enabling over 3.5 Million families to become self-reliant by extending interest-free loans worth more than £400 million. Dr Saqib's latest initiative is called Akhuwat University, which will provide higher education without any tuition fee to support the upward social mobility in the country.

Prominent Islamic Finance activists have been trying to create recognition and make an impact in the implementation of Islamic Finance in India since decades. Recent years have seen quite a few setbacks in the Islamic Finance initiatives, with many financial initiatives being eventually discovered as Ponzi schemes. Some of these prominent schemes include Heera Gold, Ambiant Marketing, and now the latest is called I Monetary Advisory (IMA). Investigations revealed that IMA did not even have a Shariah board to begin with, and often used non-Shariah compliant statements in its marketing resources. Despite claiming to be a Shariah-compliant investment avenue, IMA had promised a fixed minimum return. A country with a sizeable Muslim population like India demands a central Shariah-Compliance Certification platform that keeps a strict control over Islamic Finance activities.

Investigation authorities are probing complaints that a Bengaluru-based company, which promised to route investors’ savings into halal investments, cheated them of 2000 crore. India does not recognise Islamic banking, but there are investment options for those who do not want to violate religious laws while investing their savings. Researcher Shafeeq Rahman says that Muslims have an unmet need for Shariah-compliant investments. Because they are more likely to run their own businesses, Muslims have more need for credit and go to groups that offer halal financial services. The problem is that these institutions use the claim of Shariah investments to lure depositors, but these groups are not regulated by government agencies.