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16 December, 2007

Options and Opportunities for Muslims

For deprived individuals a secure job means more than what it means to persons belonging to an empowered community. Men with financial resources, who mainly come from empowered sections of the society, always have more opportunities for earning their livelihood. With proper education they can even create opportunities for themselves with the help of financial resources they have in such sectors as industry and production, banking and finance, hotel business and tourism, wholesale and retailing, construction and housing, education and health etc. But all these sectors are almost closed on a person who has education but no financial resources. Therefore, the best option for him is to go for a secure job. This very psychology is compelling Muslims to demand reservations in government jobs and educational institutions.

A thinking mind, however, can find openings even where the doors of opportunities are closed. And a thinking mind is what the Muslim community needs the most at this moment. This is specially required because the signs are already visible that implementing the recommendations of the Sachar Committee would not be a smooth sailing for the central government. For, one of its own ministry has come out with the opinion that even the Muslim Dalits can not get reservation under the existing law. The central government has suffered another setback as well. The RBI and the public sector banks have responded negatively to the proposal of disbursing loans to the Muslims on a priority basis. Their argument is that they do not take into account the religious background of a prospective borrower but only look at his credit worthiness. The finance minister is also reported to be in agreement with the banks’ thinking.

The banks’ worry is understandable. Already the government has compelled them to loan out to those, such as the formers, whose credit worthiness is doubtful. They would, therefore, not like the rank of such borrowers to swell. After all they are in a loss and profit business; they are not running a charity organization.

Then what can be done? Well, the government may ask its ministers, officers and banks to fall in line. But why should we bother about the job that the government has to do. Let our minds think about and find out other options.

Can Nobel Laureate Mohammad Salim’s experience help us? Many Indian organizations are already running the small credit scheme and perhaps they are doing well. The government, too, has an option here. It can create a financial corporation with sufficient fund which conducts itself on the line of Muhammad Salim’s bank in Bangladesh. There is every possibility that the successful Bangladeshi experiment will succeed in India as well.

Another option is to help Muslims establish cooperative banks. Many Muslims suffer the denial of a bank loan because they reside in areas which the banks have declared to be negative zones. A cooperative bank does not demand that only the people of legally developed areas can become its members. Yes, there are rules that cooperative banks have also to follow. If the RBI leaves it to the cooperative banks to decide which area is negative and which one is otherwise, the Muslims will stand to gain a lot from such financial institutions. The cooperative banks should also have the liberty to relax some other rules while deciding about a particular loan. For example there are hundreds of illegal colonies in Delhi whose residents fail to get housing loans from traditional banks. The irony is that the RBI has allowed cooperative banks to operate in such unauthorized areas but would not allow them to give loans to their members living therein. The RBI should be lenient and allow the cooperative banks of unauthorized areas to relax the rules for giving housing loans to the members residing in the so called negative zones.

Many cooperative banks charge a high rate of interest. The government needs to intervene here and compel the banks to follow the Muhammad Salim line. Even otherwise government intervention is required, for most cooperative banks have become the business ventures of some clever people. The government should see to it that the cooperative banks function as a source of help for the poor and do not become the financial institutions of a few rich people. And why not our traditional banks can have windows for Islamic or interest-free banking? Islamic banking is no longer an utopia, no longer even an economic feasibility but has become a living reality. The banks in the West have not opened Islamic windows because of a blind love for Islam but they have done so on the basis of economic merit. The experiment of Islamic bank or of Islamic window in traditional banks has met with success in the West. The story would not be different in India if the idea is honestly implemented here as well. So far we have discussed how the banking sector can help the Muslims to redeem their poor condition. It should not be difficult for an imaginative mind to know how other sectors can also help them. The government can play a big role here if it is indeed sincere in its concern for the Muslim minority in India.

[February, 2007]

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