Shariah compliant India Islamic Index launched;targets Gulf investor

New Delhi, Jun 25 (UNI) Aimed at attracting investors in the Gulf region and to make investment more ethical, the India Islamic Index, comprising of Shariah compliant Indian publicly listed companies, was launched here today.

The index will attract faith-based investment guided by Shariah principles and will be transparent in nature, Eastwind Capital Advisors Pvt Ltd CEO Shailendra Kumar said.

The Index will help in tracking the investment potential in the country. It is a subset of Eastwind All Share Index, which has a market capitalisation of Rs 55,56,880 crore, that is, 99.5 per cent of the total market capitalisation of India.

The Index comprises only of Shariah compliant companies equity and excludes companies engaged in alcohol products, pork-related products, conventional financial services like banking and insurance, gambling, hotels and all other business which the Shariah supervisory board considers as unethical.

Former Chief Justice of India A M Ahmadi told reporters here that Riba (prohibition of interest) is forbidden in Islam for ethical and moral reasons.

''It is said that to lend money on interest or to receive money on interest is a sin. Therefore, Muslims should avoid Riba,'' he added.

He lauded the concept of the India Islamic Index, and said it will provide an opportunity to small investors.

The Index, devised by the ECAPL, the Indo-Arab Economic Forum and Institute of Objective Studies, will be used by institutional and individual investors around the world for portfolio management and benchmarking purposes, as well as to serve the basis for structured products and other investment vehicles like ETFs.

It will also be useful for Indian banks and other financial service firms who are planning to get into financial product distribution and intermediation in Gulf countries.

''Concerns of probable slowdown in developed economies, followed by credit crunch in the US has shifted the focus of Gulf-based investors to India and China,'' Mr Kumar said.

''Appropriate enabling institutions and products need to be developed and aggressively pursued in India to attract this large pool of investments which will be upward of one trillion dollars by 2010. EW India Islamic Index is launched to fulfil this expectation,'' he added.

UNI SR SG HS1810