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Funding higher education through waqf: a lesson from Pakistan

Muhammad Usman (Department of Economics, College of Economics and Social Development, Institute of Business Management (IoBM) Karachi, Pakistan)
Asmak Ab Rahman (Department of Syariah and Economics, Academy of Islamic Studies, University of Malaya, Kuala Lumpur, Malaysia)

International Journal of Islamic and Middle Eastern Finance and Management

ISSN: 1753-8394

Article publication date: 16 November 2020

Issue publication date: 6 April 2021




This paper aims to study waqf practice in Pakistan with regard to its utilisation in funding for higher educational institutions (HEIs) and investigates waqf raising, waqf management and waqf income utilisation.


The paper is based on the views of 11 participants who are actively involved in the waqf, its raising, management and income utilisation, and is divided into three subcategories: personnel of higher educational waqf institution, personnel of waqf regulatory bodies and Shari’ah and legal experts as well as archival records, documents and library sources.


In Pakistan, both public and private awqaf are existing, but the role of private awqaf is greater in higher education funding. However, due to lack of legal supervision private awqaf is considered as a part of the not-for-profit sector and legitimately registered as a society, foundation, trust or a private limited company. Waqf in Pakistan is more focusing on internal financial sources and waqf income. In terms of waqf management, they have firm guidelines for investing in real estate, the Islamic financial sector and various halal businesses. Waqf uses the income for developmental and operational expenditure, and supports academic activities for students and staff. Waqfs are also supporting some other HEIs and research agencies. Thus, it can be revealed that a waqf can cater a sufficient amount for funding higher educational institutions.

Research limitations/implications

In Pakistan, both public and private awqaf are equally serving society in different sectors, but the role of private awqaf is much greater in funding higher education. Nevertheless, the government treats private awqaf as a part of not-for-profit sector in the absence of a specific legal framework and registers such organisations as society, foundation, trust or private limited company. The waqf in Pakistan mostly relies on internal financial resources and income from waqf assets. As the waqf managers have over the time evolved firm guidelines for investment in real estate, Islamic financial sector and various other halal businesses, and utilisation of waqf income on developmental and operational expenditures, academic activities of students and educational staff, other HEIs and research agencies, it can be proved that the waqf can potentially generate sufficient amount for funding HEIs.

Practical implications

The study presents the waqf as a social finance institution and the best alternative fiscal instrument for funding works of public good, including higher education, with the help of three selected waqf cases. Hence, the paper’s findings offer some generalisations, both for the ummah at large and Pakistan.

Social implications

The paper makes several policy recommendations for policymakers, legislators and academicians, especially the government. As an Islamic social finance institution, the waqf can help finance higher education anywhere around the world in view of the fact that most countries grapple with huge fiscal deficits and are hence financially constrained to meet growing needs of HEIs.


The study confirms that the waqf can be an alternative source for funding higher education institutions whether it is managed by the government or is privately controlled.



The researchers express their deep appreciation to the Ministry of Higher Education, Malaysia, and the University of Malaya for allocating funds for this project under a research grant [LRGS/2013/SME-UM/SI/02] and [PG006-2014B].


Usman, M. and Ab Rahman, A. (2021), "Funding higher education through waqf: a lesson from Pakistan", International Journal of Islamic and Middle Eastern Finance and Management, Vol. 14 No. 2, pp. 409-424.



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