A review of the report of the Islamic Ideological Council of Pakistan given in 1980 on Usury

Abstract

This article reviews the report of the Islamic Ideological Council given in 1980 on interest free banking in Pakistan. The report of the Islamic Ideological Council has made very strong recommendations for the implementation of the economic system of Islam. The Islamic Ideological Council with the help of Scholars and Economists, did a great job in this respect and made it a responsibility of the governmentto play its role in fulfilling the objectives of the establishment of Pakistan by acting upon these recommendations. Moreover, the Council set up a commission to minutely study the existing system and then bring into lime light its flaws and prepare its report the same to the government. The said commission proposed a phased approach to freeing the economy from interest, but these recommendations could not be implemented unluckily. Banks and financial institutions started profit and loss sharing accounts in the first phase to eliminate interest, but these accounts were operated under the old system.
The basis of this research effort to analyse the report of the Islamic Ideological Council by adopting documentary method. The Council made a number of recommendations, but little progress was made in implementing thereof. It is strongly needed for financial institutions to take steps in line with the constitutional requirements beyond immediate political interests so that the interest free banking system in Pakistan can succeed and the people can benefit from its usefulness.