India-based Taqwaa Advisory and Shariah Investment Solutions is setting up INR2.5 billion ($44 million) fund on behalf of Al Barakah Financial Services, a company backed by the Kerala state government, Bloomberg reported.
The vehicle will invest mainly in commercial real estate in the southern Indian state, Taqwaa Advisory director Shariq Nisar told the publication in an interview.
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Indian laws prohibit banking in line with the Koran’s tenets. The country has only two Shariah equity funds and Bombay stock Exchange introduced a new Islamic share index on 2 May 2013.
Indian Islamic property and stock funds are starting to give the world’s third largest Muslim population Shariah investment options in a nation where banking in line with the Koran’s tenets is prohibited.
"Islamic finance is in a nascent stage in India and definitely any new product will create more awareness and opportunity," Nisar added "There’s a lack of awareness and interest, which will take some time to be removed."
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