Islamic Modes of Financeing Reduce the Inflation in Pakistan

Topics: Islamic banking, Sharia, Finance Pages: 10 (2919 words) Published: November 3, 2012



Islamic modes of financing plays very important role to reduce inflation in Pakistan. In this research our focus on the reduce in inflation, Islamic modes of financing as one of the most important tools in reducing inflation in Pakistan. In this research proposal I verify how Islamic Modes (Masharka, Mudaraba, and Murhabah) and assets reduce the inflation in Pakistan.

Key term: Islamic modes of financing, Assets and Reduce inflation in Pakistan.


Inflation is a rise in the general level of prices of goods and services in an economy over a period of time. Islamic modes of financing are the main source to reduce inflation. Islamic banks operate in ways that differ from their conventional counterparts. Nonetheless, they Provide fund owners as well as fund users profitable opportunities. On the liability side, they provide owners of funds opportunities to place their financial resources profitably, as they become implicit partners of those institutions that share in their net profit, while carrying a proportional share in their risk. On the asset side, they provide finance to enterprises through either sharing directly in the net results of their activities or financing their purchases of assets, goods, and services. Islamic finance is one of the fastest growing and most innovative financial disciplines in the international financial market. It is growing at a rate of 15% each year, and is expected to be US$2 trillion in size by 2010.  It is one of the least understood both by the western financial community and indeed by those in Islamic communities. This course offers a clear and understandable examination of this dynamic area of finance, and is essential for bankers, lawyers, institutional investors and corporate executives. This course will help participants to fully understand the fundamental religious principles underlying modern Islamic finance and banking. It will also provide comprehensive level of understanding of unique features of Islamic financial instruments as well as their usage in practice through real-life examples. Participants will also learn religious principles and their interpretation, as well as the diversity and adaptive mechanisms of Islam.

Purpose Statement:

Very first and foremost aim of this research is to develop the interaction of reduce the inflation through Islamic modes of financing and why Islamic modes of financing is important for this situation. The research also investigates how Islamic modes (Masharka, Mudarba, and Murhaba) of financing reduce the Inflation. For this purpose, quantitative research are used to develop a questionnaire to quantify the findings and furthermore to examine the finding.

Significance of the Study:

The uniqueness of this research is that how Islamic modes of financing reduce the inflation to make the economy more committed in Pakistan. Now this study focuses on the development of the economy in Pakistan because inflation can have negative and positive effect on economy. This study examines the influence of each Islamic mode of financing reduce the inflation. The findings would be more important and favorable for the development of the economy of Pakistan.. The findings would give me an opportunity to decide which Islamic mode are more important to reduce inflation and which do not. There has been little empirical research on the relationship between Islamic modes and inflation. * The proposed study will clarify the concepts and relationship between Islamic modes of financing and economic development. * It will be Add value to students and scholars by introducing new dimensions of said topic. * It will help the government and policy makers for developing friendly procedure and policy.

Main research question:
Why Islamic modes of financing are important for the development of economy in Pakistan?...
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