The Ministry of Awqaf and Islamic Affairs in Qatar has released an electronic version of “Banking Tawarruq: A Methodological Treatment of Its Impact on Islamic Financing Instruments,” a new book examining the controversial practice of tawarruq in modern Islamic finance. The publication, authored by Dr. Riyadh bin Rashid Abdullah Al Rashoud, is now available on the ministry’s official website and through limited physical distribution. This move underscores Qatar’s commitment to fostering scholarly research and promoting a deeper understanding of Sharia-compliant financial solutions.
The book’s release comes as tawarruq continues to be a subject of debate among Islamic scholars and financial institutions globally. While intended as a workaround for prohibitions on direct lending, some interpretations of the practice have raised concerns about adherence to Islamic law. The Ministry hopes this resource will contribute to a more informed discussion.
Understanding Banking Tawarruq and its Implications
Tawarruq, also known as reverse murabaha, is a financial contract involving the purchase of an asset with deferred payment, followed by its immediate resale to a third party for a lower price. This process allows individuals and institutions to obtain financing without explicitly engaging in interest-based transactions, which are forbidden in Islam. However, the structure and application of tawarruq have led to varying opinions on its permissibility.
A Scholarly Approach to a Complex Issue
Dr. Al Rashoud’s book offers a comprehensive analysis of tawarruq, combining Sharia principles with practical financial considerations. According to the ministry, the work delves into the definition, different forms, and procedural aspects of tawarruq as implemented in financial institutions. It also explores the relationship between tawarruq and other commonly used Islamic financing instruments.
The publication further examines the juristic classifications of tawarruq according to different schools of thought within Islamic jurisprudence. This comparative analysis is intended to provide clarity on the diverse perspectives surrounding the practice. The book also addresses potential challenges and controversies related to tawarruq in contemporary banking.
Waqf Funding and the Promotion of Islamic Knowledge
The release of this book was supported by the Waqf Fund for Scientific and Cultural Development, highlighting the traditional role of waqf (charitable endowment) in advancing Islamic scholarship. The ministry stated that the bank sponsoring the printing did so in alignment with the wishes of benefactors who had designated their waqf funds for the publication of beneficial books alongside the dissemination of the Quran and Sunnah.
This initiative reflects a broader effort by the Ministry of Awqaf and Islamic Affairs to support research and knowledge dissemination in Sharia-related disciplines. The Department of Islamic Affairs, responsible for overseeing waqf-funded publications, prioritizes the selection of authoritative works and ensures their production meets high scholarly standards. The department reportedly prints dozens of scholarly volumes annually.
The ministry emphasized its commitment to providing resources for researchers and postgraduate students, offering access to key reference materials in various fields. Physical copies of the book are available to those holding postgraduate degrees in Sharia, as well as institutions and cultural libraries, through the Heritage Hall and Book Distribution Section at the ministry’s headquarters.
The book’s importance lies in its attempt to clarify a complex financial issue frequently discussed in both media and banking circles. The ministry believes the clear explanation of procedures, coupled with balanced legal and economic analysis, will enhance financial literacy and encourage sound Sharia compliance within the Islamic banking sector.
Looking ahead, the Ministry of Awqaf and Islamic Affairs has not announced a specific timeline for further publications related to Islamic finance. However, they have indicated a continued focus on supporting scholarly work that addresses contemporary issues and promotes a deeper understanding of Islamic principles. The impact of this book on the ongoing debate surrounding tawarruq and its future application within Islamic banks remains to be seen.
