Professor M. Kabir Hassan of the University of New Orleans has won the IDB Prize in Islamic Banking and Finance for the year 2016 from the Islamic Development Bank (IDB), the development bank of the Muslim world. The IDB established this prize in the year 1408H (1988) with the aim to recognise, reward and encourage outstanding contribution to promotion of Islamic economics and banking and finance. In the past 28 years, 29 researchers, bankers, economists, Shari'a scholars and institutions have been awarded the IDB Prize. Though Saudi Arabia (7 times), Pakistan (6 times), Syria (3 times), Egypt, Jordan, Malaysia, Tunisia, the UK (2 times), Iran, India, Sudan, Turkey, UAE (once) have won this prestigious prize, Dr. Kabir is the first Bangladeshi to win it.
We join millions of global Islamic banking and financial industry's stakeholders to extend our warmest greetings to Dr M. Kabir Hassan for winning the IDB Prize 2016 in Islamic banking and finance and putting Bangladesh on the world map of IDB Prizes. The award of the Nobel Peace Prize earlier made Bangladesh proud and significantly enhanced the country's image in the international community.
The IDB award has not only brought honour to this country, it has shown that Bangladesh can also give something to develop and flourish Islamic banking and financial industry around the world. With many other thinkers, Dr. Kabir has proved that an Islamic alternative to banking and financial instruments can be offered in a way that can create opportunities for large numbers of people to get out of interest-based banking and finance. In the words of the IDB Prize Selection Committee, "The eminent scholars noted the quality of the intellectual contribution of Professor Hassan and the impact of his research in the field of Islamic Banking and Finance. The Committee also took into consideration the services rendered by Professor Hassan to various multilateral development banks as well as his role in introducing law for Islamic banks to operate with a clear legal code in his home country of Bangladesh."
In his initial response, Dr. Kabir, an internationally recognised expert in Islamic banking and finance, explains, "I started my journey eventually in Islamic finance because there is something principle-wise that really attracted me. Islamic finance is based on the principle of risk-sharing, shared responsibility, and doing things in a cooperative way. Those are the principles that are also enshrined in the Bible, in the Torah". He further goes on saying, "Islamic finance principles can bring some light, bring people together, show prosperity, reduce poverty, and bring happiness to everybody".
Dr. Kabir has 169 papers published in academic journals on development finance, money and capital markets, Islamic finance, corporate finance, investments, monetary economics, macroeconomics and international trade and finance. His innovative ideas and empirical works as well as consulting and teaching services have made him one of top contemporary contributors in the field of Islamic banking and finance.
Professor Kabir has also been cited as one of the most prolific authors in finance literature in the last 50 years in a paper published in the Journal of Finance Literature. His publication record puts him among the top 5.6 per cent of all authors who published papers in 26 leading finance journals. He is among the top 5 per cent authors according to the number of journal pages at RePAC/IDEAS. Dr. Hassan is among the top three presenters in the financial management annual meetings during 1990-2013. He has won 23 Best Paper Awards from academic conference presentations. In addition, he has numerous teaching awards for his outstanding teaching from the University of New Orleans and outside academic organisations.
In his long academic career, Prof. Kabir has published papers on a wide range of issues related to Bangladesh which include microfinance and the Grameen Bank, efficiency of Bangladesh's stock market, financial sector reform, trade liberalisation and industry performance, trade relations and policies, fiscal and monetary performances, Islamic banks and role of zakat in poverty alleviation in Bangladesh etc. In his study of the shadow economy, SE for short, (unreported income from production of goods and services to avoid paying income taxes) of Bangladesh, Dr. Hassan finds that the size of the SE in Bangladesh is 10 per cent according to the currency demand approach, and 38 per cent according to MIMIC approach. He also finds that economic variables (GDP per capita and unemployment rate) generally influence the size of shadow economies more than policy ones (regulations and various measures of tax burden) and concludes that if governments can implement incentive-oriented policy measures that make work in the SE less attractive, this may lead to stabilisation, or even reduction, in the size of the SE (source: Transparency International Bangladesh, 2011). Prof. Kabir also estimates zakat in Bangladesh with secondary macro-data and finds that the total zakat that could be collected might have reached Tk.127,600 million in the fiscal year 2005-06. For the last ten years we observe an average 6 per cent annual GDP growth in Bangladesh and if we assume that zakat collection is growing at least as like as GDP growth, then the total zakat collection in 2015-16 could be Tk 228,512 million (US$ 2,856 million) which is 23 per cent of the national development budget of that year. So, various social safety net programmes as well as public and merit goods can well be financed through zakat and thus play a significant role in the country's poverty reduction strategy.
Professor M. Kabir Hassan is truly an extraordinary personality and deep inspiration for young researchers. We would like to thank the Islamic Development Bank for choosing a much-deserved Bangladeshi economist for this prize and congratulate him for his achievements and valuable contribution to the development of Islamic banking and finance.
The writer is a PhD student at International Islamic University Malaysia. He holds B.S.S. and M.S.S. degrees in Economics from University of Dhaka. [email protected]
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