Islamabad: 26th Constitutional Amendment Bill, 2024 passed by Senate, has established deadline of January 1, 2028, for end of practice of Riba (interest-based banking) in country.

Clause was included on recommendation of Jamiat Ulema-e-Islam-Fazl. To eradicate this form of usury, Senate approved amendment in clause (f) of Article 38 of Constitution, which pertains to promotion of social and economic well-being.

Current clause states that “Eliminate riba as early as possible,” and government replaced this with “As far as practicable, by January 1, 2028.”

Earlier in 2022, Federal Shariat Court gave government five years to implement an Islamic and interest-free banking system in country, as economic system of an Islamic country like Pakistan should be free of interest.

Justice Dr Syed Muhammad Anwer read out verdict that was reserved by three-member bench of Federal Shariat Court. Verdict stated that abolition of riba is fundamental for an Islamic system, adding that any transaction involving riba is “Wrong”.

“Government should ensure that internal, external loans and transactions should be made interest-free. Transactions with international institutions, including IMF and World Bank, should be made interest free as well,” said court.

Published in The Daily National Courier, October, 21 2024

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