Dr. Hafas Furqani in this report attempts to survey the progress and development of Islamic economics in Indonesia by showing the dynamics of its emergence and development. The discussion attempts to look at Islamic economics from three dimensions; system (practice), knowledge (theory) and movement. The exploration is approached from various angles; the history, narratives and trends in Indonesian Islamic economy, as well as the institutions, researches and policies for developing Islamic economics in Indonesia. The analytical method of discursive analysis is used to understand the dynamics and development of discourse of Islamic economics in Indonesia and a policy analysis to understand the policy made by Indonesian authority / regulator to develop Islamic economics and finance industry.

In this regard, the report ventures into history of Islam and economy in Indonesia, the early discourse on Islamic economics in the era of independence 1940’s until 1960’s followed by the emergence of Islamic economics in 1970’s – 1990’s. To understand the dynamics of the practices and discourses of the early development of Islamic economics in Indonesia, this report attempts to survey various speeches delivered by political leaders, fatwas issued by Islamic organizations in Indonesia, as well as various notes and publications.

The development of Islamic economics and finance in the next phase is then discussed by showing the development of Islamic economic and financial institutions in Indonesia including Islamic banking, takaful, Islamic capital market and zakat institutions. The data used to explain the development is gathered from the respective authorities and regulators in Indonesia to get an updated information as well as from various reports published by reputable institutions. The position of Indonesian Islamic economic and finance industry in the global market is also discussed based on the data released by various international reports on Islamic economics and finance industry. The development of Islamic economics and finance in practice is also followed by the progress in body of knowledge i.e. in education, research and publication, as can be seen in the last section of the report.

The report may be termed as a unique work, explaining the development of Islamic Economics in Indonesia, an important Muslim country, from its inception to date, covering all the academic, institutional and governmental dimensions