Dr. Syed Aun Raza Rizvi’s research originated from an interest in Islamic economics and a general observation of the emerging markets’ economy. The idea that had struck a chord with the professor for some time was that the concept of Islamic economics could not be as basic as a legal compliance of banking products. The wisdom of Allah’s commandments goes beyond mere legal interpretations and must have a long-reaching inclusive shared stake in the economic spoils of any nation. This led to an exploration of the theme of Islamic economics and finance, which lies in the risk-sharing principle of economics. As it goes, the development of early European city-states was founded upon the principle of sharing risks. This principle helped these city-states develop their infrastructure and rule their western landscape in terms of science and economy.

In essence, the research idea was born to explore whether there is a risk-sharing financial instrument which may address the woes of the emerging nations. In addition, which financial instrument is also incompliance with the Shariah and thus satisfies the religious sensitivities of the masses. The idea was to develop and test an instrument, which is not a mere legal compliance to Islamic law as most Islamic financial instruments are but an instrument, which fits in with the true spirit of risk sharing.

This led Dr. Rizvi to explore if risk sharing, which forms the crux of Islamic economics, can still be witnessed in other parts of the world. The exploration led to finding traces of the principle in current western financial systems in the form of venture capital financing, albeit the primary focus has diverted to risk shifting-based debt financing.
While exploring the progress of emerging economies and especially Islamic finance over the past decades, much effort and research have gone into establishing a viable set of Islamic financial institutions. Most Muslim nations are heavily indebted with high reliance on multilateral financing primarily based on high-interest rates. This vicious cycle of interest rates and debts has stunted the growth of these nations and worsened the conditions for the masses.

Dr. Rizvi’s research brings to the forefront the concept of equity in nature GDP-linked paper, which allows for enhanced risk sharing-based sovereign financing. It aims to present empirical proof of the stability this instrument offers in economic growth, for a large sample of developing economies, comprising the bulk of Islamic countries. While analysing the empirical work, a strong favourable argument for this instrument is derived for its benefits instability.

Through this study, we endeavoured to initiate a thought-provoking and practical discussion for the further development of these instruments for the betterment of developing countries. The impact and the final implementation of this instrument is still something that needs to be seen. There needs to be an intent and sincerity from the policymakers to explore and accept equity in nature instruments. Meanwhile, the heavy dominance of Islamic legal experts and Shariah scholars within the field of Islamic finance with the sole focus on legal compliance is a challenge to a wider acceptance of this instrument. Will this instrument see the light of the day? This remains to be seen.