A British venture capital firm plans to launch Europe's first halal industrial park, tapping an under-served market worth up to $6.27 billion a year.
"If you look at some figures, the halal sector in the UK is worth between 2 to 4 billion pounds, the majority of that is imported," Mahesh Jayanarayan, chairman of Halal Industries, told the Reuters Islamic Banking and Finance Summit.
He said the Super Halal Industrial Park (SHIP) will be based in South Wales, adding that it was chosen because of its meat industries and affordable land prices.
The park would provide services such as storage, product packing, meat selection and processing as well as research and development.
Halal Industries has partnered with the Penang International Halal Hub (PIHH), the agency set up by the Malaysian state to promote halal-related industries.
Muslims should only eat meat from livestock slaughtered by a sharp knife from their necks, and the name of Allah, the Arabic word for God, must be mentioned.
Jayanarayan said the project will take three to five years to launch and will cost around 150 million pounds -- a sum he plans to raise in the capital markets, by sourcing government grants and by finding anchor-partners.
"This would be a private equity play but also a property play, purely because we are trying to pre-sell the project to industrial people to come in."
Europe has no halal industrial parks, despite being home to millions of Muslims.
Growing Demand
Jayanarayan says SHIP will help to make Britain a landmark Halal center for the region.
"You have 2.5 billion people on the planet eating halal food, directly or indirectly," he noted. "This halal market is not going away, it is not some fad."
The total European halal food market is currently valued at about $66 billion, including meat, fresh food and packed food, while the global market is worth about $634 billion.
A successful first project could lead to further launches across Europe, particularly countries with sizable Muslim population such as France and Germany.
"We would prefer to go to places like Bosnia, where there's a large Muslim population and... we could seek EU grants," Jayanarayan said.
The firm is also planning to set up an Islamic stock exchange in either London or Luxembourg to try to encourage the development of Islamic enterprise.
"We have a technical partner, a Shari'ah board and we have identified a board of directors, but there is still a lot of work to be done," said Jayanarayan.
The exchange would abide by Shari'ah, restricting practices such as short-selling and the use of leverage.
In recent years, London has established itself as a hub of Islamic finance.
Britain has four licensed wholesale Islamic banks - the only ones in the European Union.
There are also 21 conventional banks offering Islamic banking products.
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