Islamic Infrastructure Fund (IIF)

Islamic Infrastructure Fund (IIF)

Introduction

Islamic Development Bank is one of leading financial institutions in the world with a though-provoking and commitment to promote Islamic Finance around the globe (Annual report, 2012). The Bank was developed as a result of Conference of Finance Ministers of Muslim Countries and in pursuance of declaration of intent of the agenda of the conference. The conference was held in Jeddah, Saudi Arabia. It was held in the month of Dhul Qadah 1393 Hijri, else in December, 1973. In the month of Rajab 1395 Hijri i.e. July, 1975, an inaugural meeting of the Board was held. The formal commencement of operations dated back on 20th October, 1975.

The institute is headquartered in Jeddah, KSA. The regional presence of IDB is in Morocco, Malaysia, Kazakhstan, and Senegal. According to the recent data published (Annual report, 2012), IDB holds a membership of about fifty-six countries, located in diverse regions around the globe such as Pakistan, Iran, Iraq, Indonesia, Libya, Malaysia, Jordan, Yemen, Uganda, UAE, etc The membership criterion is that:

A country aiming to be member of IDB should have a membership/affiliation with OIC i.e. Organization of the Islamic Cooperation.

Payment of at least a first installment of the least subscription portion of the capital stock of Islamic Development Bank.

Abides and conforms with the terms & conditions laid down by the Board of Governors of the IDB.

The Islamic Development Bank has an authorized capital of about 30,000 million out of which about 18,000 million is a capital outstanding while the subscribed capital resembles the figure of 17,800 million. The institution has a paid-up capital of about 4600 million, as at on 31st December, 2012 (Annual report, 2012). The strategic framework of IDB was adopted in the Hijri of 1424. The new framework comprises of 05 entities i.e. IDB, ITFC, IRTI, ICD, and ICIEC (The Halal Journal, 2008).The key strategic focus of these diverse entities is upon multiple factors such as eradicating poverty, health and health-related promotional activities & assistance, striving for education, Islamic financial industry expansion, etc (The Halal Journal, 2008).Islamic Infrastructure Fund (IIF- IDB) Islamic Infrastructure Fund is one the Asia's major infrastructure fund. Islamic Infrastructure Fund (IIF) was established in the year of 2001 with a basic focus and motive to aid in the infrastructural development of its member countries (Annual report, 2012). The objectives to develop the fund are:

Collaborating with member countries by making equity & equity-related investments in order to seek long-term capital appreciation through undertaking various infrastructure projects.

Promoting the practical feasibility of using Islamic Finance in the infrastructural projects.

The Islamic Infrastructure Fund is first of its kind. It is the first private investment vehicle, based on the Islamic Finance theory and is a completely Shariah compliant. The fund with a focus to enhance member countries infrastructural capabilities was registered in Bahrain. The fund was managed by the subsidiary of EMP, Washington i.e. Emerging Markets Partnership (EMP), Bahrain. The policy and performance of the fund, as well as a representation ...