Performance, Islamization, and Trust: Pakistan’s Evolving Banking Sector
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2025-01-03
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Abstract
Out of the global Muslim population of 1.6 billion, just 14% utilize banking services. In Pakistan, only 21% of adults had bank accounts as of December 2017. While there are multiple factors behind the low bank account penetration in Muslim-majority nations, religion plays a pivotal role. The Federal Shariat Court of Pakistan (SCP) issued a directive in 2022 instructing the Government of Pakistan to begin removing interest (Riba or usury) from its economic apparatus by December 2027 to Islamize the country. Well before this judgment, the conventional banking industry was opposed to wealth concentration. To illustrate, in 1974, the government claimed that 22 influential families, possessing 66% of the country’s industrial wealth and 87% of its banking and insurance, held dominion over Pakistan’s industry. Under such unfavorable circumstances, is it possible for Pakistan to boost its financial inclusivity and hence economic development by getting people to trust the interest-based banking system? If so, how can trust theories explain this?
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Scholars@Duke
Fasih Zulfiqar
I'm a student at Duke University pursuing a Master's in Analytical Political Economy, maintaining a 4.0 GPA. My academic journey began at IBA Karachi, where I was honored as my batch's valedictorian and graduated summa cum laude in Economics and Mathematics.
My research focuses on the intersection of environmental economics, political institutions, and development in South Asia, particularly Pakistan. I explore demand-side factors hindering climate change mitigation and the potential of green finance as a climate strategy. Towards this end, my work, forthcoming in Consilience: The Journal of Sustainable Development at Columbia University, investigates the determinants of green behavior in Pakistan and South Asia, going beyond traditional income and education factors.
I'm deeply interested in how political systems impact economic development, especially concerning climate adaptation strategies. My research extends to the role of religious institutions in economic growth, with a particular focus on Islamic principles and their effect on financial inclusion. My paper in the Columbia Economic Review, "Exploring Trust in Pakistan's Financial Institutions," analyzes how religious factors can act as punctuated equilibrium forces in developing countries' financial sectors.
My latest piece, "Performance, Islamization, and Trust: Pakistan's Evolving Banking Sector," published in the Stanford Economic Review, further explores these themes. I've also presented research on green financing success in South Asia at the 19th South Asian Economics Students' Meet (SAESM) in Colombo, funded by the World Bank.
Professionally, I've leveraged my analytical skills as a Market Research Strategist at Aromasong USA, where I applied quantitative forecasting and financial modeling to drive business decisions, generating $39,900 in new trade. As an Economic Consultant for Alibaba x Trademor, I provided strategic consulting to over 100 entrepreneurs, facilitating $31,040 in sales through market expansion and cross-border partnerships. My experience extends to supply chain data analysis at Lipton and data analysis at Engro, where I utilized statistical models to assess risk factors in new markets and guide sustainable development initiatives. Lastly, I also have mentoring and teaching experience at NTHP x IBA and The Citizens Foundation.
I'm proficient in advanced technical tools including MATLAB, R, Python, and STATA, which I apply to complex economic modeling and data analysis. My language skills span English, Urdu, German (proficient), and French (A1).
As a recipient of the Emergent Ventures Grant from Professor Tyler Cowen at the Mercatus Center, George Mason University, I continue to push the boundaries of economic research, aiming to contribute meaningful insights to the field of political economy and sustainable development. Beyond academics, I'm passionate about philosophy, particularly Stoicism and Existentialism, and I enjoy powerlifting, soccer, and spending time with dogs.
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