India launches its own ‘sharia stock index':
The Bombay Stock Exchange has launched India’s first index of companies compliant with Islamic law, or shariah, in an effort to bring more of the country’s 175m Muslims into mainstream finance, and to attract investment from foreign shariah-abiding funds.
Shariah finance has become a trillion-dollar global business, most notably in the Gulf. But in spite of India’s sizeable Muslim population, it has not yet taken off in south Asia. The creators of the new index – called the BSE Tasis Shariah Index and launched on Monday – hope to change that.
The index is made up of the 50 biggest Indian companies whose operations are deemed to be consistent with shariah – meaning that they don’t derive significant profit from interest payments, or sell products or services such as tobacco, alcohol or weapons, which are considered in the Islamic faith as sinful.