By Fatima Mohammed-Lawal
Ilorin, April 22, 2021 A don, Prof. Abdulrazzaq Alaro, has urged the Federal Government to take the advantage of Islamic finance through the global Sukuk market for economy development.
Alaro, of the Department of Islamic Law of the University of Ilorin , made the remarks while delivering the institution’s 196th inaugural lecture.
The lecture was entitled; ” Islamic financial services: the interplay of religion, law and corporate social responsibility.
The expert on Islamic Law reiterated that access to Islamic finance would play a key role in achieving the economic objective of reducing the high level of financial exclusion in Nigeria.
Alaro said research had shown that majority of “unbanked population” were Muslims, adding that the “unbanked” population deliberately avoided conventional banks on religious grounds.
He said that one important and viable alternative that could positively change the narrative of African infrastructural inefficiency was the Sukuk, which he said was an instrument of the Islamic Capital Market.
He commended President Muhammadu Buhari, for issuing the first sovereign Sukuk worth N100 billion.
“With the unprecedented success rate of Sukuk for the road and school construction in the country, governments at all level, as well as corporate organisations should take advantage of the innovative instrument to develop other key sectors of our economy,” he said.
Alaro described Islamic finance as justice through profit, loss and risk sharing, prohibition of gambling, excessive uncertainty and interest (riba).
According to him, Sukuk is a sharia-compliant bond-like instruments used in Islamic finance.
He observed that since the rise of Islamic finance, sukuk had became extremely popular since 2000, when the products was issued in Malaysia.
“Sukuk are used by Islamic corporations and state-run organizations alike around the globe, taking up an increasing share of the global fixed-income market.
“Sukuk as a prominent product of Islamic finance has been issued by government and corporate bodies in China, Japan, United Kingdom, Hong-Kong, South Africa and Luxembourg,” he said.
Alaro further explained that Islamic finance had no bearing with Islamisation Agenda, adding that it is currently offered in about 80 countries, most of which are non-muslim countries.
“Islamic finance does not reflect the adoption of Islam as a religion, and this explains why Britain remains the Christian-majority state, having its first Islamic financial entity, Islamic Banking of Britain incorporated in 2004,” he said.
Alaro pointed out that the major feature of Islamic finance was the prohibition of interest (riba