MUMBAI: In a major development which may go a long way in the process of Islamic financial system in the country, the Bombay Stock Exchange (BSE) and Taqwaa Advisory and Shariah Investment Solutions (TASIS) have launched the BSE- TASIS Shariah 50 Index on Monday
According BSE release the Index will be the first Shariah Index created in India utilizing the strict guidelines and local expertise of a domestic, India-based Shariah advisory board. The BSE TASIS Shariah 50 index consists of the 50 largest and most liquid Shariah compliant stocks within the BSE 500.
TASIS employs a strict, proprietary screening process utilizing their knowledge of and local access to listed Indian companies to ensure that all stocks included within the BSE TASIS Shariah 50 are strictly compliant with Islamic Shariah law.
TASIS has adopted financial screening norms that are more conservative than its peers, making the product ideal for Islamic investors seeking investments that adhere to the strict, conservative Shariah compliance norms.
“The introduction of the BSE TASIS Shariah 50 Index will give Islamic and other socially responsible investors another means to access the Indian market and will help attract pools of capital to India from the Gulf, Europe, and Southeast Asia”, said Madhu Kannan, MD & CEO of BSE adding that the index would build a base for licensing for the construction of Shariah compliant financial products including mutual funds, ETFs, and structured products.
A senior member of TASIS M.H. Khatkhatay said that Shariah Index will unlock the potential for Shariah investments in India. “This is the first time a serious and concerted effort has been made to track Shariah compliant stocks in India objectively,” he said.
According to Dr. Shariq Nisar Director, Research & Operations, TASIS the BSE has the largest number of listed Shariah compliant stocks in the world. “All Muslim countries of the Middle East and Pakistan put together do not have as many listed Shariah compliant stocks as are available on BSE,” he said
The BSE TASIS Shariah 50 employs index constituent weight capping. Index constituent weights are capped at 8% at rebalancing, in an effort to increase the diversification within the index and ensure greater compliance with international regulatory and statutory investment guidelines.
TASIS is India’s premier Shariah Advisory institution associated with the vast majority of Shariah compliant products available in the country. It was founded by a group of finance and investment professionals who realized the need for a credible organization to provide guidance and support to individuals and corporate having an interest in the nascent but rapidly growing Islamic finance industry in India.
TASIS specializes in Shariah advisory, product structuring, monitoring and Shariah certification. Currently it advises Indian companies, including government owned enterprises and those from the private corporate sector in matters related to the application of Shariah in business matters. Scholars on the TASIS Shariah Board are based in North America, Europe and India, and are public figures having high repute within their respective fields of specialization.