Islamic ideology of socio -economic integrity is based on removing interest and all other unfair means and elements from the world The Islamic system provides facility relating to any financial activities like lending functions, borrowing functions and investment functions on a risk and loss-sharing basis This enables the market forces to find the output of capital instead of fixing it in advance as "interest rate" to damage the system of free market and support tentative use and capital hoarding. The Islamic system of financial activities ensures the most favorable rate regarding formulation of capital and its efficient use guide to reasonable opportunities and strong economic growth. This system is purely the value-based scheme, which largely aims at ensuring material and moral welfare of the person and society in one piece. The activities regarding Islamic banking and finance were particularly remained around the three regions of the world, which include Southeast Asia, Middle East and South Asia The area of Middle East was totally occupied by Muslim communities so this region is called the homeland of Islamic banking. There is a big support towards the Islamic banking and finance in the region of Middle East from governments, wealthy individuals and some state institutions. The greater part of the regulatory authorities of Islamic banking industry and finance industry are situated in the region of Middle East. Most of the sound countries have planned to merge their central banking systems and monetary systems by 2010. This kind of developments in the regions of Middle East countries and worldwide, put a huge impact on the industry of Islamic banking and industry of finance. In South Asia, especially Pakistan has just introduced the Islamic banking system. Bangladesh has also introduced the harder polices regarding Islamic banking due to the growing market and of public. Afghanistan and India is also about to implement Islamic banking policies in future. In Addition. the reaion of Southeast Asia. three countries named Singapore Malavsia and Indonesia are 2. The word it in the sentence"...capital instead of fixing it -.. of paragraph 1 refers to __ C (A) interest rate (B) market forces (C) loss-sharing basis (D) output of capital 3. The word favorable in the sentence "...the most favorable rate regarding formulation of capital ..." of paragraph 1 is best replaced by __ C (A) complimentary (B) detrimental (C) agreeable (D) kind