India has no Islamic banks but local institutions are meeting a growing demand for students seeking knowledge of Shariah-compliant banking, takaful, microfinance and wealth management
Demand for Islamic finance education is growing in India with thousands of students and professionals seeking to register with the country’s handful of universities and course providers to enhance their career prospects even though opportunities are limited in a country that has no Islamic banks.
Two Indian universities – Aligarh Muslim University (AMU) and Calicut University – run classroom-based diploma and degree courses in Islamic finance, with a combined capacity to enrol less than 600 students per academic year. The students are often selected through an entrance test from a large number of applications.
AMU, for instance, currently inducts only 20 students in the Islamic finance course, from thousands of applications it receives every year for the 100 seats it has across three post-graduate courses – Post-Graduate Diploma in Islamic Banking and Finance, Master of Business Administration (MBA), and MBA in International Business.
“They are selected through a combined MBA entrance test. I think this time more than 3,500 students appeared and we selected only 100 for the three courses based on interviews and group discussions,” Prof. Valeed Ahmad Ansari of AMU told Salaam Gateway.
Calicut University is the only one in the country to run a Master of Arts (MA) in Islamic finance through two of its affiliated colleges, Al Jamia Arts and Science College and Darul Uloom Arabic College. Both collectively enrol only 25 students. The university also sees enrolment of around 500 students every year for its graduate programmes through 10 other affiliated colleges in Kerala, which sends the highest number of expatriate workers to Middle Eastern countries.
The other options for those seeking an academic grounding in Islamic finance are course providers such as BSE Institute and the Institute of Islamic Banking Finance & Insurance (IIBFI).
Vinod Nair, Academic Head of BSE Institute, which has been running many distance-mode and classroom-based short-term courses on Islamic finance for the past five years, told Salaam Gateway: “The students do look at acquiring a certification that will help them take up job opportunities in other countries. I think that has been one of the main drivers for them to look at Islamic finance courses.”
BSE Institute is the education subsidiary of the Bombay Stock Exchange (BSE), the largest in India, which was among the first in the country to also launch a Shariah Index in 2010. The institute has certified more than 300 professionals over the past five years.
Responding to growing demand, BSE Institute is launching new distance-mode Islamic finance courses.
“We are introducing this month three online certification programmes on Islamic microfinance, Islamic wealth management and Islamic insurance, or takaful. These are targeted at students and professionals who wish to enhance their knowledge or upgrade their qualifications to pursue a career in this domain, but don’t get the opportunity to attend our classroom programmes,” said Dr Shariq Nisar, a faculty member with the BSE Institute and Islamic finance expert who developed the specialised courses.
“The course gave me a clear understanding about the range of Islamic finance products, and what constitutes halal and what is haram. From the career perspective, these are useful if India allows Islamic banking in future, or if I am exploring new jobs in the Middle East related to Islamic banking and finance,” Nadeem Alam, a BSE Institute alumnus, told Salaam Gateway. Alam currently works in the financial education, training and business development domain for a U.S.-based multinational company.
Short-term courses from the Chennai-based IIBFI are another option for both students and professionals. The institute, set up in 2011, is currently the only online certificate course in Islamic banking, finance and insurance. It certifies between 50 and 60 students each year.
“The main purpose for us to start the institute was to reach out to more people using technology, by offering online courses in Islamic finance. We wanted to address the particular problem of India, where there are few teachers and many students,” Mohammed Asim Farooq, Director of Administration & Academics at IIBFI, told Salaam Gateway.
The demand for these courses does not come from India alone. IIBFI says it has trained more than 500 professionals so far from all parts of India as well as other countries such as Somalia, Nigeria, Uganda and the U.S., besides non-resident Indians (NRIs) from Saudi Arabia.
BSE Institute’s Nisar added: “BSE Institute gets students from Bangladesh, Sri Lanka and other Asian and Arab countries for various finance-related courses. When they realise the institute also teaches Islamic finance, they want to enrol.”
The next level of attainment seems to be a fully-fledged post-graduate degree in Islamic banking and finance, which is still not available in India, except as a Master of Arts programme from Calicut University.
Fatima Khalid, who completed her post-graduate diploma in Islamic Banking and Finance from AMU in 2011, says she actually wanted to do a Master’s degree as well but could not do so in the country. “India didn’t have such institutions. And I didn’t get an opportunity to go abroad for further studies. So I had to settle for a post-graduate degree in International Business from a Delhi university,” she told Salaam Gateway.
Currently working as a senior reporting analyst at a Delhi-based knowledge process outsourcing (KPO) company, Fatima says she always wanted to pursue a career in Islamic finance but had no opportunity to do so in India.
The Uttar Pradesh-based AMU, which has been offering its diploma course since 2010, is now planning to convert it into a full Master’s programme. “We have revised our curriculum so very soon we will be launching an MBA in Islamic finance or something similar,” said Prof. Ansari.
Being one of the pioneers in Islamic finance education, AMU’s diploma is “well respected even in countries like Malaysia or those of the Middle East, where many of alumni go for further studies or jobs”, he said, but agreed “the depth of the degree also needs to be ratified”.
AMU’s Islamic finance students generally look at the diploma course as an adjunct to their post-graduate degree course. “That’s the reason we are considering increasing the credibility of our certificates in the market by offering a full Master’s course” in the subject, Prof Ansari said.
FEW DOMESTIC JOB OPTIONS
Kerala-based Al Jamia Al Islamia, an Islamic education centre, has also been running a diploma programme in Islamic banking and finance since 2004, and says it has so far trained more than 300 students, but is not affiliated to a university. “Since no university was offering such courses or subjects in their curriculum at that time, we started the Islamic finance diploma course,” faculty member Dr. Mohammed Palath told Salaam Gateway.
From the perspective of a career, Dr. Palath said that although India may not offer many opportunities, the state of Kerala has multi-state co-operative credit societies that function on Shariah principles. And, of course, “many students after completing these courses go abroad to work,” he said.
Muhammed Ashfakh, an alumnus of Al Jamia Al Islamia, is among the lucky ones who have managed to find a related job within the country. “After finishing my diploma, I spent around two years teaching Islamic finance in colleges until I got a job with Sangamam Multi-state Co-operative Credit Society in Kerala,” said Ashfakh, who is now its managing director.
The credit society, which doesn’t come under the purview of Indian banking regulation, has more than 9,000 members, 3 crore Indian rupees (30 million rupees, about $468,000) share capital and 20 crore rupees (200 million, about $3.12 million) in deposits. In the past five years, it has disbursed 48 crore rupees (480 million, about $7.5 million) as interest-free credit to its members.
In the absence of Islamic banking in India, most Islamic finance graduates seek careers outside the country, but many find their training does not meet the levels of specialisation and sophistication that the global Islamic finance sector needs.
Industry observers say short-term certifications or even the degree courses offered in India may not stand the test as standalone qualifications in the job market, but as add-ons to other degrees.
“What is needed for the global market is a specialisation or higher degree, which not many institutes in India offer,” added Dr. Nisar, who says he has helped many institutes develop their Islamic finance course curriculums.
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