Islamic Banking in Pakistan

Pakistan was created, in the first instance, as an Islamic Republic since its inception and independence from Great Britain in 1947. It adopted Shari[ah (Islamic Law) in its first ever constitution. It is also one of the earliest countries that converted its conventional banking system to Islamic banking in 1985. Yet, its Islamic banking and finance sector has not been performing as well as expected. One wonders why this is the case? And why it did not end up leading the movement of Islamic banking and finance, instead of Malaysia or the Gulf countries? The author of the book under review, Feisal Khan, who is the Chair of the Economic Department at Hobart and William Smith Colleges in New York, USA, claims that since independence, there has been a continual tension and conflict over Pakistan’s essential character, between Islamic Minimalists who favour a modernist interpretation of Islam, and those who favour an Islamic maximalist interpretation that sees Pakistan as a model Islamic state. The answer to the questions posed above, could perhaps be found in this conflict of ideas and the subsequent activities that resulted consequently.