Talia Minullina: “The Islamic finance hub that Tehran wants to create in Kazan is a direct result of our work through KazanForum”
One of the key topics of KazanForum was the discussion of the current experiment to introduce the principles of partnership financing in Russia.
The XV International Economic Forum “Russia - Islamic World” has ended. 87 countries of the world and 87 regions of Russia took part in it, 151 business sessions were held, 120 agreements were concluded. Hundreds of business meetings were held between business representatives from Russian regions, government bodies, educational institutions, delegations from countries around the world - Belarus, Oman, Libya, Iran, Turkey, Tajikistan, UAE, Qatar, Malaysia, India, Afghanistan, Azerbaijan and other countries.
One of the key topics of KazanForum was a discussion of the current experiment on introducing the principles of partnership financing in Russia, which was launched on September 1, 2023 in 4 pilot regions: Tatarstan, Bashkortostan, Chechnya, Dagestan.
At the expert session on May 17, which was attended by the Chairman of the State Duma Committee on the Financial Market Anatoly Aksakov, Deputy Minister of Finance of Russia Ivan Chebeskov, Rais of the Republic of Tatarstan, Chairman of the strategic vision group “Russia - Islamic World” Rustam Minnikhanov gave his assessment of the project. He said: “One of the key goals of the experiment is to create a mechanism for attracting foreign investment in Russian projects from the countries of the Organization of Islamic Cooperation.” The Rais of Tatarstan also noted that since the beginning of the experiment, about 1,300 transactions have been concluded in the republic. New partner financial products have appeared - project financing, preferential financing of small businesses, financing of leasing companies.
Mohammad Esmail Hazzar, General Director of World Business Bank, which belongs to Melli Iran Bank, explained at the expert session how the demand for Islamic banking services is growing. In 2021, the Bank founded the financial company Miras, which began to work on the principles of partnership financing. It is growing very quickly and plans to increase its authorized capital to 300 million by the end of 2024.
On the left is Seyed Said Vakili, manager of the additional office of MB Bank in Kazan, on the right is Mohammad Esmail Hazzar, General Director of World Business Bank
Impressive growth dynamics: if in 2021 2 transactions on the Murabaha service were concluded, in 2022 - 4, then in 2023, the year the experiment in Islamic finance began, there are already 74. Almost the same number - 64 transactions were concluded only in the 1st quarter of this year. Accordingly, the volume of transactions increased from 4.2 million rubles to 160 million rubles.
The volume of Mudaraba transactions increased 3 times in 2023, reaching 1,500 million rubles; in the 1st quarter of this year alone, transactions worth 500 million rubles were concluded. Most of the funds are allocated by the company’s clients to the purchase of industrial equipment and transport, which means that all these tools serve the development of business, both ours and Iran’s, as well as the economic partnership of our two countries.
Iran today is a vivid example of how the mechanism for attracting investment into the banking sector of Tatarstan and Russia actually works. And the partners have ambitious plans: to create a financial hub - the Islamic Russian Bank Miras (MIR Bank) and to expand their business in the regions as much as possible. By the end of the year, offices in Moscow and Astrakhan will open. At the last KazanForum, the Miras company, according to Seyed Said Vakili, manager of an additional office of MB Bank in Kazan, received a number of proposals to open offices in Chechnya, Dagestan, Bashkiria, and the Samara region. In this regard, specialists in Islamic finance are actively recruited.
The Iranian bank's immediate plans include offering Islamic insurance (takaful), as well as introducing other types of partnership contracts: Musharakah, Ijara muntahia bi at-tamlik, Qard-ul-hasan and others. The seriousness of intentions is confirmed by the increased attention of the Iranian side to the office in Kazan. Last fall, as part of the opening of the renovated office of World Business Bank, Mohammad Esmail Hazzar, General Director of World Business Bank, and Abolfazl Mahmoud Najarzadeh, General Director of Bank Melli Iran, visited the capital of Tatarstan. Then, at a solemn ceremony, Iranian Deputy Minister of Economy Mohammad Javad Sharifzadeh and Iranian Consul General in Kazan Davud Mirzakhani noted the important role of KazanForum in the development of relations between Russia and Iran.
Head of the TIDA Taliya Minullina:
“Successful work of a foreign investor in the regional market is always the result of a huge amount of work to gain trust. It is KazanForum that helps us provide a decent platform for interaction with friendly countries, solving a number of practical problems, the main one of which is to create new business opportunities. The largest delegation came to the last KazanForum from Iran - 152 people. For every entrepreneur, working with a bank in his country is an additional weight in the decision-making process to invest. Iran also participated in the Halal Expo. Intercountry sessions between Russia and Iran were successfully held.
And here is the result - already at the end of 2023, the government of Tatarstan began active discussions on the creation of an Iranian Trade Center in the republic. And trade is the engine of investment!
It is also a good indicator that more than 1,200 Iranian students are studying in the republic today. The Iranians know that we are always open to cooperation, and they are taking reciprocal steps. For example, the flow of tourists from Russia to Iran is constantly growing, and soon, when traveling to this country, Russians will be able to receive special tourist cards that will allow them to make purchases and pay for services. Now this financial instrument is at the final stage of testing. The card can be topped up in any currency outside Iran."
Minullina Talia Ilgizovna
Head of the Investment Development Agency of the Republic of Tatarstan
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