Bankers’ perception towards Bai Salam method for agriculture financing in Pakistan
Tóm tắt
Islamic banking is planning to increase its market share up to 12 per cent of the total banking sector in Pakistan by 2012, as compared to its current market share of 5.6 per cent. This article collected the bankers’ views towards agriculture financing under the Islamically acceptable mode – Bai Salam (forward sale agreements of crop). It further compared agriculture financing under Islamic and interest-based financial systems. Overall, findings from this article are that bankers at large are confused about the application mechanism of Bai Salam contracts mainly because of improper land record maintained by the Revenue Department, widespread illiteracy and current government policy of issuing a single loan against each passbook (property record). The article presents recommendations that can be useful for the financial institutions not only in developing effective monitoring mechanisms, but also in minimizing financial losses.
Tài liệu tham khảo
Government of Pakistan. (2002–03) Economic Survey of Pakistan. Islamabad, Pakistan: Ministry of Finance.
Government of Pakistan. (1988) Report of the National Commission on Agriculture. Islamabad, Pakistan: Ministry of Food and Agriculture, p. 451.
State Bank of Pakistan. (2009) Guidelines on Islamic financing for agriculture. Islamic Banking Department, Karachi, circular # ACD 01/2009, February 03.
State Bank of Pakistan. (2009) Islamic banking bulletin. Islamic Banking Department, Karachi, Volume IV, no. 4, December, p. 5.
Government of Pakistan. (2000) Pakistan Agriculture Census Report. Islamabad, Pakistan: Ministry of Agriculture and Livestock.
Houtman, R.C. (2006) Financing Seasonal Crops: A Proposal for Bai Salam in Afghanistan. Food and Agriculture Organization of the United Nations, Department for International Development, Project Discussion Paper 19, October.
Usmani, M.T. (1998) An Introduction to Islamic Finance. Karachi, Pakistan: Idaratul Ma’arif, p. 186.
Ayub, M. (2008) Understanding Islamic Finance. West Sussex, UK: John Wiley & Sons, p. 249.
Lovelace, J.A. (1998) Export sector liberalization and forward markets: Managing uncertainty during policy transitions. Africa Economic Analysis, http://www.africaeconomicanalysis.org/articles/general/financialmarletshtm.html.
McIntire, J. and Varangis, P. (1999) Reforming Cote d’Ivoire's Cocoa Marketing and Pricing System. World Bank Policy Paper.
Krueger, A. (1993) Political Economy of Policy Reform in Developing Countries. Cambridge, MA: The MIT Press.
Bates, R. (1981) Markets and States Tropical Africa: The Agricultural Basis of Agricultural Policies. USA: University of California Press.
Shepherd, A. and Farolfi, S. (1999) Export crop liberalization in Africa – A review. FAO Agricultural Services Bulletin no 135.
Dorward, A. et al (1998) Commercial financing of seasonal input use by smallholders in liberalized agricultural marketing systems. ODI Natural Resource Perspectives Number 30, Overseas Development Institute, London, UK.
Brambilla, I. and Guido, G.P. (2006) Farm Productivity and Market Structure: Evidence from Cotton Reforms in Zambia. World Bank Policy Research Working Paper 3904.
Hoff, K. and Stiglitz, J.E. (1993) Imperfect information and rural credit markets: Puzzles and policy perspectives. In: K. Hoff, A. Braverman and J.E. Stiglitz (eds.) Economics of Rural Organization: Theory, Practice and Policy, Chapter 2, New York: Oxford University Press, pp. 33–52.
World Bank. (2003) Rural finance access survey. National Council of Applied Economic Research (NCAER), World Bank.
World, Bank, (2006) Improving Access to Finance for India's Rural Poor. Washington DC: World Bank.
State Bank of Pakistan. (2002) Agriculture sector development: Problems and issues. Governor Inaugural Speech at the Financial Sector Development Organized by the Agriculture Development Bank of Pakistan.
State Bank of Pakistan. (2006–2007) Annual report on the review of economy. Publication Department, Karachi, Volume 1, p.16.
State Bank of Pakistan. (2007–2008) Annual Report. Publication Department, Karachi.
Khandker, S.A. and Faruqee, R. (2003) The impact of farm credit in Pakistan. Agricultural Economics 28 (3): 197–213.
Qureshi, S., Nabi, I. and Faruqee, R. (1996) Rural Finance for Growth and Poverty Alleviation. Policy Research Working Paper no 1593, Food and Natural Resources Division, World Bank.
State Bank of Pakistan. (2002–2003) Annual Report. Publication Department, Karachi.
Aleem, I. (1990) Imperfect information, screening and the cost of informal lending. World Bank Economic Review 4 (3): 329–349.
Malik, S.J. (1990) Poverty and Rural Credit: The Case of Pakistan. Islamabad, Pakistan: Institute of Development Economics.
Word Bank. (2005) Land Records Management and Information Systems Program (LRMIS-P) Province of Punjab. South Asia, Report no AB 1428.
Word Bank. (2005) Pakistan Rural Factors Market: Policy Reforms for Growth and Equity. Rural Development Unit, South Asia, Report no 30381-PK.
Kaleem, A. and Wajid, R.A. (2009) Application of Islamic banking instrument (Bai Salam) for agriculture financing in Pakistan. British Food 111 (3): 275–295.
State Bank of Pakistan. (2006–2007) Annual Report. Publication Department, Karachi.