On Mumbai’s bustling Cadell Road you could walk past the office of Taqwaa Advisory and Shariah Investment Solutions (P) Ltd (Tasis) without noticing it. A low-key signboard in a row of other businesses, typical of old-fashioned office blocks all over the island city, is all that announces their existence.
It’s a far cry from the behemoth of Dalal Street, but Tasis’ subdued presence belies the significance of its recent collaboration with the Bombay Stock Exchange (BSE). In December, they launched the BSE TASIS Shariah 50 Index, which lists the largest Shariah-compliant stocks within the BSE 500.
It isn’t the first such index in the country. The National Stock Exchange already compiles a list of Shariah-compliant stocks. But it is the first that is based on the stipulations of a wholly India-based Shariah board. The architects of the BSE Shariah 50 are counting on a new wave of attention that they hope will transform the landscape for observant Muslims, as well as investors concerned with social responsibility.
“The notion of Shariah compliance has been around for 1,400 years,” says Jamil Ahmed Shaikh, director of Tasis. “In India, you could date the practice of Islamic banking to the late 1970s when small groups of Muslims in north India and in Mumbai started cooperative societies and chit funds.” But the effects were marginal, he says, and remained so until recently. “Over the last decade, people started to look at it as a way of alternate finance, and there’s more enthusiasm than ever after the subprime crisis (of 2008).” He smiles, “Once you get stuck in one area, you start to look for others.” Continue reading