Page 20 - CMA Journal (Mar-Apr 2025)

Exclusive Interview

AAOIFI advances these efforts and plays its role through
advocacy and Shariah-audit guidelines, standardizing By drawing on the intellectual
Sukuk recognition and measurement (FAS 33) and
transparent reporting (FAS 34), and emphasizing funding contributions of early thinkers like
allocation to marginalized sectors, thereby enhancing
transparency, investor confidence, and sustainable Prof. Khurshid Ahmed, Dr.
economic growth.
Muhammad Umer Chapra, and Sh.
ICMA: What steps can the Pakistani government and
private sector take to foster a stronger Islamic Muhammad Taqi Usmani, Pakistan
financial ecosystem, and how can AAOIFI guide this has cultivated a skilled workforce,
process?
with professionals serving
Omar Mustafa: Quaid-e-Azam Muhammad Ali Jinnah, in
his inaugural speech at the State Bank of Pakistan, important positions in global
emphasized the failure of the western economic system
and the need for Pakistan to follow an Islamic economic Islamic finance institutions boards
model based on justice and equity. This vision was
reinforced through constitutional amendments from such as AAOIFI
1973 onwards to establish a Riba-free system rooted in
Shari’ah law. Since then, economic transactions have
positioned to establish itself as a sustainable and a
been restructured to focus on asset-backed contracts
like Murabahah and Ijara, reducing speculation and successful Islamic financial system.
linking credit to tangible assets. Profit-and-loss sharing ICMA: Given the global rise in demand for Islamic
models, such as Mudarabah and Musharakah, have
finance, what can Pakistan do to become a leading
helped equitably distribute returns and align the hub for Shari’ah-compliant financial services?
interests of capital providers and entrepreneurs. The
prohibition of interest charges has ensured that Omar Mustafa: Pakistan has an opportunity to establish
economic practices align with Quranic principles of itself as a global knowledge base and infrastructure hub
fairness and mutual benefit, contributing to greater for Shari’ah-compliant financial services. By drawing on
stability, inclusivity and ethical accountability in the intellectual contributions of early thinkers like Prof.
Pakistan's markets. Khurshid Ahmed, Dr. Muhammad Umer Chapra, and Sh.
Muhammad Taqi Usmani, Pakistan has cultivated a
A major attempt was made to Islamize the economy in
skilled workforce, with professionals serving important
the 1980s, which unfortunately failed due to the lack of positions in global Islamic finance institutions boards
standardized practices, effective governance, and
such as AAOIFI.
structured capacity-building. To develop an Islamic
financial ecosystem, Pakistan must ensure the Despite challenges like adverse economic conditions
implementation of standardized Shari’ah-compliant and developing regulatory framework, significant
products, governance frameworks, and human resource potential exists. Pakistan is still one of the largest Islamic
development. Islamic finance, as it is directly focused on finance markets in terms of the number of branches,
assets and transactions, encompasses diverse business employees, and customers, with a good number of its
activities such as sales, purchases, goods, services, banking sector already dedicated to Islamic finance,
commodities, and entrepreneurship, where money is particularly with the planned conversion of conventional
exchanged for economic value rather than banks to Islamic finance by 2027. To enhance its position,
interest-based money-to-money transactions. Pakistan should focus on human resource development
and expand capabilities in outsourced services,
These principles promote ethically grounded economic consultancy, and back-end operations. With the right
activity. AAOIFI addresses earlier shortcomings by
resources and trainers, ICMA can drive transformation,
offering comprehensive Shari’ah standards, governance empowering students and its members to enhance their
mechanisms, accounting and reporting frameworks, and
skills in Islamic finance and remain competitive in the
specialized training and capacity building programs. It is global market.
actively working with institutions like ICMA to enhance
Islamic finance education and human resource The Editorial Board thanks Mr. Omar Mustafa Ansari, Secretary
development in Pakistan. AAOIFI considers Pakistan as General, Accounting and Auditing Organization for Islamic
Financial Institutions (AAOIFI) for sparing from his precious
one of the most important destinations and a good time to give exclusive interview for Chartered Management
model of Islamic finance to emulate globally. With Accountant Journal.
consistent application of these standards, Pakistan is

18 ICMA’s Chartered Management Accountant, Mar-Apr 2025