Comparative Analysis of Islamic Finance Regulations and Global Economic Laws

• Prof. Dr. Ali Akbar āl Azhārī

  Head of the Department, Department of Islamic Studies, Garrison University, Lahore

  Author

This study offers a comparative analysis of Islamic finance law and the global set of economic laws, outlining their conceptual underpinnings, regulation frameworks, and practical applications in the contemporary financial era. Islamic finance, based on Sharia law, emphasizes ethical conduct, asset-backed financing, and the outright exclusion of interest (riba). Global economic laws, shaped by mainly Western-inspired legal traditions and global institutions, emphasize the virtues of contractual freedom, capital mobility, and interest-rate based financial instruments. Through a review of high-order similarities—such as a shared emphasis on transparency, accountability, and anti-money laundering policies—coupled with fundamental differences in risk allocation, investment screening, and debt management, this study finds the challenge and opportunity for harmonization between the two systems of regulation. Drawing on case studies from countries where the Islamic and global systems co-exist side by side, this paper offers policy recommendations to enhance compatibility and enable cross-border financial integration while maintaining the underlying ethical values inherent in each system.

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