REUTERS: MUMBAI/KUALA LUMPUR - Money managers in India have begun launching sharia-compliant funds, hoping to tap the country's large Muslim population, the world's third-biggest after Indonesia and Pakistan.
The push toward the new funds comes in the wake of dwindling cash flows into more traditional investment channels, which have been hit by a stock market slump and slowing economic growth.
In January, the portfolio management services unit of HSBC's (HSBA.L) Indian fund arm started offering a sharia product, and on Wednesday Mumbai-based Benchmark Asset Management launched India's first exchange-traded sharia fund.
"There is a need gap...for investment products that are sharia-compliant," said Vikramaaditya, chief executive of HSBC Asset Management.
Zafar Sareshwala, chief executive of Mumbai-based Islamic brokerage Parsoli, said sharia-compliant funds could easily raise $1 billion from millions of potential Muslim investors. >>> By Nishant Kumar & Liau Y-Sing | Thursday, February 5, 2009
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