Bodu Bala Sena CEO, Dilantha Withanage accused that this was an attempt at Islamification of societies using petrodollars, revenue earned from exporting petroleum
The Bodu Bala Sena in a letter to Central Bank Governor, recently expressed their displeasure at CB’s inaction on the introduction of religious based banking practices, Shariah-compliant financing to be more precise.
In the letter to the CB Governor, the Bodu Bala Sena (BBS) revealed that it has received a number of complaints from bankers and citizens on CB’s failure to act on the introduction of the said religious based banking practices, on grounds it may create ‘social division in the country’. Moreover the BBS believes that this goes against equal rights ensured in the constitution.
The issue arose due to certain private banks opting for Shariah Banking options to attract customers that require Shariah-compliant financial products. Shariah-compliant finance systems prohibit interest, known as riba, or usury in Islamic terms. The Shariah Banking system is structured around a strict code of ethics, based on the Quran, and claims to forbid exploitative practices.
However, at a recently held press conference, Bodu Bala Sena CEO, Dilantha Withanage said, “Central Bank and many private banks have made attempts to introduce religious banking to Sri Lanka. But the Muslim community in Sri Lanka has engaged with the banking industry for decades without religious-specific banking practices. Why introduce one now?”
Moreover, Withanage accused that this was an attempt at Islamification of societies using petrodollars, revenue earned from exporting petroleum. Withanage rebuked authorities for not seeking public opinion prior to introducing such a system.
Shariahhfinancewatch.org, a US based blog, identifying itself as ‘a service of the Center for Security Policy’ pinpoints a number of threats associated with Shariah-compliant financing. According to the site, it is mandatory for Shariah-compliant US banks to ‘purify’ certain returns on investment dollars that do not meet Shariahh law standards by ‘donating to Islamic charities, including some that promote Jihad and support suicide bombing.’ Moreover the site states that based on investment disclosures these profits can be as high as six percent of profits of investments. “With $800 billion already in SCF assets, the potential for billions of dollars to be siphoned off for terrorism is real,” says the site.
Shariahh Finance Watch also implicates Shariahh-compliant financial institutions of using charities to fund terrorist groups.
When contacted BBS CEO, Dilantha Withanage said, “This begs the question, should the banking sector be expected to entertain different banking systems for each and every religion?”
Withanage reiterated that such an introduction; in a country where 90 percent of the population is none Islamic, will only lead to socio-ethnic divisions. “After all Shariah-compliant is essentially Islamic,” said Withanage, implicating that it would invariable create a division by being identified as exclusively Islamic.
Amana Takaful Executive Director, Ehsan Zaheed said that this is not necessarily true. “Shariah-compliant is not exclusively for Muslims. In fact the majority of Amana customers are non Muslims.”
Zaheed explained that ‘Shariah-compliant financing’ is met with such hostility because of the stigma attached to the term ‘Shariah’. “We must learn to go beyond the label,” said Zaheed. “In fact the underlying principles are found in other religions such as Buddhism and Christianity too.”
Zaheed pointed out that Shariah-compliant financing is socially beneficial, in that it forbids funding of activities such as casinos and breweries. “It’s not for the rich to get richer, instead it incorporates the underprivileged into the system. If the system is properly put into practice it will be for the benefit of the public, because the underlying principles of Shariah-compliant financing encourage profit sharing.”
If it is a question of the label ‘Shariah-compliant’, will a simple label change resolve the issue? According to Zaheed, other developed countries are already practicing similar financial principles under ‘Alternative Finance’. “Non majority Muslim countries such as Japan and South Korea have adopted the Shariah-compliant model as ‘Alternative Finace’,” said Zaheed. Reiterating the necessity for looking beyond the label.
In reply to the letter sent by the BBS, the CB Governor has recommended a meeting with Policy Planning and Economic Affairs Deputy Minister, Dr. Harsha de Silva. He was not available for comment.