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turned out to be its largest sources of A more detailed explanation on the On some key issues regarding Islamic period of democratic transition meant
income. The MUI formed two institutions: DPS emerged in 1999 in Government banking, BI sometimes decided its own a return of radical groups and Islamic
LP-POM in 1989, which grants halal Regulation no. 30/1999. It states that a policies, although most still depend to a political parties’ demands for the
certifications for all food products, drugs, DPS should be independent from the large extent on the MUI DPS that claims implementation of the Jakarta Charter,
and cosmetics that circulate in Indonesia, bank’s management and it must have the to the most authoritative institution to which they consider the symbol of the
and the first Islamic bank, the Bank authority to determine whether banking settle these issues. 57 inclusion of the Shari’a in the Indonesian
Muamalat Indonesia (BMI) in 1991. It products, services, and activities are Constitution. The radical-fundamental
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started to organize the rejuvenation of in accordance with the Shari‘a. The The 1995 MUI national conference Islamic movement was represented
the ulama in 1990 by offering courses institution most apt to this task is the shows the programs of the MUI in by organizations such as the Islamic
in Islamic law for prospective religious MUI. Hence, a bank that offers Shari‘a the New Order era most clearly. It Defenders Front (Front Pembela Islam,
scholars from various regions. National products should be supervised by appeared that the programs of the FPI, 1998), Laskar Jihad (LJ, 1999), the
development has also consistently been someone from the MUI who sits on its MUI were divided into functional and Indonesian Mujahidin Council (Majelis
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one of the MUI’s core projects. Shari’a Advisory Council. This was of institutional groups. The first are the Mujahidin Indonesia, MMI, 2000), the
MUI’s traditional tasks as advisor of
The BMI is one the MUI’s products in course a big project and it generated the government and the community, Muslims Community Forum (Front Umat
banking. However, its banking-related large funds because of the MUI people’s strengthening Islamic brotherhood, Islam, FUI), the Jama’ah Islamiyah (JI),
activities did not halt there. Since the early strategic positions in the banking world. education, and the supervision of and the Liberation Party of Indonesia
1990s, one very important concentration Before the 1990s, this had never been Islamic propagation activities, Islamic (Hizbut-Tahrir Indonesia, HTI) which had
of the MUI was its conceptualization of the done by this “clergy” institution. economy, and Islamic identity. The become more and more consolidated
Shari’a Banking system and to ensure that In the 1990s, the government recognized second included more practical despite having its roots in the period
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all banks would offer Shari‘a products. An the development of Islamic banking by activities such as the propagation of before the Reform era started.
institution under the MUI’s authority that the issuance of Law no. 10/1998. Wider participation in efforts to build society, The strengthening of Islamic
fully participated to this end is the Shari‘a recognition came in the Reform era fundamentalism also extended to the
Advisory Council (Dewan Pertimbangan after the House approved and passed the establishment of Islamic financial political arena with the founding of the
Syari’ah, DPS). In 1992, the government Law no. 21/2008 on Shari‘a Banking. forums including Islamic banks and Justice Party (Partai Keadilan, PK, 1998)
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extending enrichment models and
issued Law no. 7 on the banking system. From then on, Shari‘a banks enjoyed that later became the Prosperous Justice
A derivative regulation of this Law is the same status as conventional banks trainings for Muslim scholars. Party (Partai Keadilan Sejahtera, PKS),
Government Regulation no. 72/1992. and all Shari‘a banking products were The MUI in the of Reformation Era the Crescent Star Party (Partai Bulan
Paragraph 5 states that any bank that allowed. Nevertheless, frequent disputes Bintang, PBB), in addition to the United
applies for the basic principle of profit arose and overlap occurred between The fall of the New Order regime in Development Party (PPP) that tuned its
sharing ---which is claimed as the basic the Central Bank of Indonesia (Bank 1998 brought about changes in the principles back to Islam. In addition to
principle of Islamic banking to avoid the Indonesia, BI) as the highest banking concepts of Indonesian nationality and supporting the implementation of Islamic
forbidden usury---,is required to have or authority and the MUI as the institution the governmental system, including law in Indonesia, some organizations
raise a DPS. 55 that safeguarded and “produced” DPS. Islamic movements and politics. The were concerned or even directly involved

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