No objection on interest-free banking in Kashmir: Rajan

No objection on interest-free banking in Kashmir: Rajan

Published at 29/05/2015

Srinagar, May 28:

 Governor of Reserve Bank of India, Raghuram Rajan Thursday said he has no objection to establish interest-free financing system in Kashmir if provided a proper module for its establishment.

After hearing the concerns and suggestions put forth by various trade bodies, Rajan said his organization has no problem in supporting interest free financing in the state.

“He didn’t use the word Islamic banking but said he is ready to establish interest free banking on Kerala pattern as long as it fits within their parameters,” President, Kashmir Chamber of Commerce and Industry (KCCI), Sheikh Ashiq said.

The RBI Governor also said he would approach Government of India for financial assistance to Jammu and Kashmir to help it tide over economic crisis following last year’s floods.

“We informed him about the current financial constraints in the state. We told him that our housing and business sectors suffered massive damage in floods and there is a dire need of help,” Ashiq added.

He said they also requested Rajan to ease the norms in RBI guidelines and provide soft loans for the commercial purposes.

“We told him that the repaying capacity of business community has been severally impaired due to the flood damage and RBI should give loans on lower interest rate,” Ashiq said.

“He assured that RBI will provide all the help and also take up the issue with GoI for financial assistance.”

President Federation Chamber of Industry Kashmir, Muhammad Ashraf Mir said RBI Governor told participants that it is ready to facilitate interest-free financing when asked about introduction of Islamic banking in Kashmir.

“He told us that he understand the religious sentiments of people and have no objections towards Islamic banking if being approached for the same,” Mir said.

“We also requested the RBI Governor to use his good offices to approach GoI for financial help to the state,” Mir said.

However, Chairman of KTMF, Muhammad Yaseen Khan said even though RBI Governor expressed his willingness to start Islamic banking here but passed the buck to GoI on rehabilitation package.

“The Governor was willing to help to establish Islamic banking but remained non-committal on rehabilitation package,” Khan said.

Khan said it has been 10 months but no one seems serious to help the flood-hit people of Kashmir.

“Every time we are being paraded before dignitaries to beg for rehabilitation but nothing has been done to rehabilitate flood affect people,” Khan said.

RBI Governor is on a two-day visit with a focus on rehabilitation of last year's flood-affected people in the Valley.

http://risingkashmir.in/news/no-objection-on-interestfree-banking-in-kashmir-rajan/