Global Islamic finance company AAOIFI to work with Pakistan to develop Shariah-compliant capital market

A vendor selling stones waits for customers at a market in Lahore, Pakistan, on May 29, 2023. (AFP)
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Updated 30 May 2023
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Global Islamic finance company AAOIFI to work with Pakistan to develop Shariah-compliant capital market

  • Development comes day after Pakistan organized an inaugural Islamic Capital Markets Conference
  • The country has second-largest Muslim population in the world with very low banking penetration

ISLAMABAD: A leading Bahrain-based international non-profit, aimed at developing the global Islamic finance industry, has showed interest in enhancing collaboration with Pakistan on promoting the Islamic capital market in the South Asian country, the Pakistani finance ministry said on Tuesday, a day after the inaugural Islamic Capital Markets (ICM) Conference in Islamabad.

The conference was jointly organized by the Securities and Exchange Commission of Pakistan (SECP) and the Accounting & Auditing Organization for Islamic Financial Institutions (AAOIFI), the Bahraini firm responsible for the development and issuance of standards in the areas of Shariah, accounting, auditing, ethics and governance for international Islamic finance globally.

On Tuesday, Sheikh Ebrahim Bin Khalifa Al-Khalifa, who is the chairman of the AAOIFI Board of Trustees, held a meeting with Pakistan's Finance Minister Ishaq Dar in the Pakistani capital and exchanged views with him on mutual collaboration in the field of Islamic finance.

The two figures discussed "enhancing mutual collaboration with Pakistan in social welfare, business & financial sectors," the Pakistani finance ministry said in a statement.

"And promoting Islamic finance industry and capital market in Pakistan."

Pakistan has the second-largest Muslim population in the world with very low banking penetration. The government seeks to increase financial inclusion through promoting Islamic finance, as part of the National Financial Inclusion Strategy. Only 21 percent of the adult population had a bank account in 2017, with 13 percent of adults citing religious reasons for not having them, according to the World Bank.

The SECP and AAOIFI also signed an agreement at the conference for joint cooperation in areas of “common interest” that would support the development of the Islamic banking and finance industry.

In 2021, the government set a target of increasing the share of Shariah-compliant instruments in government securities to at least 10 percent by the end of 2022-2023. There are 22 Islamic banking institutions currently operating across the country.

The assets of Pakistan’s Islamic banking industry had posted a year-on-year growth of 29 percent in fiscal year 2022, Dar said as he addressed the ICM Conference on Monday.


Curfew extended in Gilgit-Baltistan, probe ordered after deadly Khamenei protests

Updated 03 March 2026
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Curfew extended in Gilgit-Baltistan, probe ordered after deadly Khamenei protests

  • At least 15 people were killed in clashes with law enforcement agencies over the weekend in Gilgit-Baltistan
  • Government also announces a de-weaponization campaign, crackdown on hate speech and cybercrime in region

ISLAMABAD: The government in Pakistan’s Gilgit-Baltistan (GB) region on Tuesday extended a curfew in Gilgit district and ordered a judicial probe into violent protests over the killing of Iranian Supreme Leader Ali Khamenei in US-Israeli strikes last week, an official said.

At least 15 people were killed in clashes with law enforcement agencies over the weekend in GB, where protesters torched and vandalized several buildings, including United Nations regional offices, an army-run school, software technology park and a local charity building.

The violence prompted regional authorities to impose curfew in Gilgit and Skardu districts on March 2-4 as officials urged people to stay indoors and cooperate with law enforcers, amid widespread anger in Pakistan, particularly among members of the Shiite minority, over Khamenei’s killing.

On Tuesday, the GB government convened to review the situation and announced the extension of curfew in Gilgit among a number of security measures as well as ordered the establishment of a judicial commission to investigate the weekend violence in the region.

“The government has made it clear that the law will strictly take its course against elements involved in vandalism at government institutions, private properties and incidents of vandalism in Gilgit and Skardu and no kind of mischief will be tolerated,” Shabbir Mir, a GB government spokesperson, said in a statement.

“In view of the security situation, curfew will remain in force in Gilgit, while the decision to extend the curfew in Skardu will be taken keeping the ground realities and the changing situation in view.”

The statement did not specify how long the curfew will remain in place in Gilgit.

Besides the formation of the judicial commission to investigate the violent clashes, the government also decided to launch a large-scale de-weaponization campaign in the entire Gilgit district, for which relevant institutions have been directed to immediately complete all necessary arrangements, according to Mir.

In addition, a crackdown has been ordered on hate speech, spread of fake news and cybercrime.

“The aim of these decisions is to ensure the rule of law, protect the lives and property of citizens and crack down on miscreants,” he said. “Approval has also been given to immediately survey the affected infrastructure and start their restoration work on priority basis.”

Demonstrators in Pakistan’s southern port city of Karachi also stormed the US Consulate on Sunday, smashing windows and attempting to burn the building. Police responded with batons, tear gas, and gunfire, leaving 10 people dead and more than 50 injured.

Pakistani authorities have since beefed up security at US diplomatic missions across the country, including around the US consulate building in Peshawar, to avoid any further violence.