Friday, March 27, 2015

The Dillema of Modern Islamic Finance

By Omar Javaid

I recently participated Doha in 10th International Conference on Islamic Finance and Economics, one of the largest gathering of its kind, listening/discussing my views with various top experts in the field. I also presented a paper on how Islamic concept of wealth and modern concept of capital differs with each other.

In a nut shell all the discussion on the problems and solution in the realm of Islamic Finance were revolving around the challenges emerging for misplacing knowledge of Islamic Finance in the modern western institutional framework standing on foundations completely incompatible with that of Islam! ...

Its like to save the horse, you chop off some part of its body and put it inside a car (horse skin for car seat covers) and expect some benefit for the horse, and when the horse dies or cries in pain then you wonder whats wrong, and wonders how to save the horse. Or to save the tree you chop of some of its branches and place them inside the exhaust of the car... These are exaggerated metaphors however they explains the dilemma and what is being done in the industry of Islamic finance.

Islam is organic (Muslim ummah is like one body, pain of one Muslim is felt by all; the individuals are related spiritually, emotionally and of course contractually as well, and the nature and integrated design of institutions like that of family, bazaar/guilds/souqs etc, waqfs, courts, madarasah, etc.) vs the modern industrial capitalist system is mechanical (it works like a machine as its evolved out of a steam engine/boiler operated production line into a bureaucratic machinery, and this machine logic is everywhere, its a machine design to create money, which is used as a fuel to run the machine to produce more money/capital, so on so forth)...

Taking something from an organic system and putting it into a mechanical system is absurd, and expecting it to work is more absurd, and then lots of time and energy to discuss the problem arising from this misplacement, without realizing the fundamental mistake (which I would argue is an honest mistake) is even more absurd to a ridiculous level.

I presented my paper on the same idea and shared this insight infront of various top experts in the field like Mehmet Asutey (Head of Durham University Islamic Banking program in UK), Dr. Kabir (from US), Muhammad Ayub, to Dr. Asad Zaman, etc. etc. and I am yet to find a top scholar in the field who hasn't agreed to this fundamental problem.

But since its like any other phenomenon, Islamic Financial Industry is also like a snow ball and recommendations from people like me and Dr. Asad Zaman (who has also explained clearly the design of original institutions in one of his paper). Will take perhaps development of another track independent of existing phenomenon, if not adopted by the existing bandwagon.

Tuesday, February 3, 2015

Pedagogy for Entrepreneurship

By Omar Javaid

The idea of entrepreneurship being a viable, lucrative and possible career option is being promoted all across the country keeping in view the economic challenges such as unemployment; the untapped opportunities & potential we have.

The system of education which the country has been following up till now was developed & perfected to meet the requirements of a very different kind of circumstances. 2013 TED prize winner and renowned educationist Sugata Mitra explains it as a perfect system to produce managers for a Weberian style bureaucratic machinery which in fact still exists, but perhaps not for so long. The graduating students were/are considered as standardized 'products' as if they were coming out of an assembly line. Renowned educationist and thinkers like Sir Ken Robinson, Noam Chomsky, Seth Godin, and futurist Alvin Tofler has compared the traditional design of education system with the design of a factory intended to transform students into subservient beings who submits themselves to the rules of the organization and authority, who are void of any critical thinking, have identical dialects, who largely thinks and stays within the box and are afraid of experimentation and making mistakes or take risks.