Islamic banking implementation prospects in Bashkortostan will be discussed at International Business Week

Bashkortostan was included in the regions where an experiment is being implemented to introduce partner financing models. We are discussing a project for implementing Islamic banking, in which the republic will participate, and three other subjects. Islamic banks work according to Sharia principles: they issue money without interest, but only for specific projects.

At the program conference held on December 6, this event was announced by Anatoly Aksakov, Chairman of the Russian State Duma Committee on the Financial Market, Chairman of the Council of the Association of Banks of Russia. He noted that after the bill’s adoption in the first reading in December, severe and extensive work is to be done to eradicate any possibility of fraud.

Commercial and financial operations in Islamic banking are very similar—possible abuse. For example, VAT is not charged for a financial transaction but must be charged for a commercial transaction. The desire to avoid paying VAT will not be among those involved in Islamic finance. Still, among those engaged in commercial transactions, it is essential to write down all the nuances in the law so that later we will not be accused of creating loopholes for scammers. The professional opinion of people already working in this system is essential, so we closely cooperate with Indonesia, Malaysia, and Turkey banks. We take into account their experience, Anatoly Aksakov explained.

To launch the project, a round table, Prospects for the development of partner financing in the regions of the Russian Federation, will be held as part of International Business Week, the Legislative Aspect of Development, the participants of which will discuss approaches to the experiment in the regions. Maxim Filimonov, Deputy Director of the Legal Department of the Bank of Russia, will be one of the section speakers.

“I will present to my colleagues a draft law on experimenting with establishing special regulation. It has already been submitted to the State Duma, and next year we plan to launch a project in which the Republic of Bashkortostan will also become a participant. Ufa always welcomes guests. Here, business issues are resolved faster and more efficiently,” Maxim Filimonov added.

A broadcast of forum events will be available on the website.