Kerala High Court gives nod to Islamic bank before Assembly Elections

The  Kerala government has taken a huge step towards creating an Islamic bank which will comply with Shariah rules.

The Kerala High Court has dismissed a petition that said an Islamic bank violates the principle of secularism as laid out in India’s constitution. The petition had been filed by former Law Minister Subramanian Swamy.

Shariah rules prohibit charging interest for loans and emphasise on the sharing of profits and losses. So, rather than earning interest on deposits, customers get a share of the overall profit reported by the bank.

The activities of the bank will be supervised by a Shariah Supervisory Board which will include Islamic scholars.

The sanction for the Islamic bank comes three months ahead of elections in Kerala. Muslims constitute 25 per cent of Kerala’s vote bank and recent elections have reflected that they are moving away from the Left Front government.

The Congress has not taken a stand on the issue, while the BJP has voiced its opposition.

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