Indian Muslim stock exchange starts for enterprise

In accordance with Shariah law, Muslims aren’t permitted to spend money on businesses that derive substantial benefit from interest, as Muslims look at this to be usury. To be able to work with this constraint yet nevertheless allow business-minded Muslims to develop stock portfolios, the Bombay Stock exchange (BSE), the Taqwaa Advisory and Shariah Investment Solutions, have created a top-50 Islamic stock index. Listed as the BSE TASIS Shariah 50, the index picks the top 50 businesses within the BSE 500 with liquid stocks that are Shariah-compliant. They will now be in a position to follow their laws without having to take out large pay day loans.

Rapid growing sector proven in Islamic stock index

The Wall Street Journal reports that, even more impressive than the Bombay Stock exchange, was the Islamic stock index which went up 0.5 percent. Within the Islamic world, it’s typical for a lot of investing in Shariah-compliant goods like mutual funds that will not give more interest or extra risk. The WSJ accounts the Shariah finance is a trillion dollar industry throughout the world which the BSE TASIS Shariah 50 is playing a huge role. It makes sense that the Islamic stock index is needed, considering about 15 percent of the population in India is Muslim, which is one of the largest Muslim markets on the earth.

Credit-to-deposit is not deposited

The national credit-to-deposit ratio is about 74 percent, although Indian Muslims only have it at about 47 percent which was found by the Reserve Financial institution of India. What this means, as outlined by the WSJ, is that compared to what Indian Muslims save, they borrow a great deal of money that could feasibly be used to open an enterprise or buy assets at a lower rate than the rest of the Indian population. Experts predict the Bombay Stock exchange TASIS Shariah 50 may help smooth out that ratio for Indian Muslims, however it also remains likely the Islamic stock index will make India a destination for foreign Islamic finance.

Articles cited

Debt Steps

debtsteps.com/credit-to-debt-ratio.html

Wall Street Journal

blogs.wsj.com/indiarealtime/2010/12/27/bombay-exchange-hopes-to-score-with-shariah-index/

Some call it ‘financial jihad’

youtube.com/watch?v=Ulp_96DYiqg