After many years of opposing the idea, the Reserve Bank of India (RBI) has written to the Indian government requesting that it amend laws forbidding Islamic banking in India. Central bank governor Duvvuri Subbarao told reporters at a local event on October 3 that the RBI is in talks with the government about whether or not to allow shari’ah, or Islamic law-compliant finance.
In June, the National Commission for Minorities (NCM) spoke up in favour of introducing such financing by submitting a proposal to permit interest-free banking. Following this, the finance ministry asked the RBI to reconsider the matter. Until this point, India’s central bank had insisted that Islamic banking was not viable in the country………………………………………..Full Article: Source