Abstract: Why did only Malaysia and Pakistan adopt state-led Islamization as a strategy for expansion of state power? How did this strategy serve their interests? What was the impact of this strategy on these countries and their societies? In the end, Islamization did serve state interests, but at the cost of laws and procedures that were neither viable in the long run nor were they socially beneficial. Furthermore, Islamization strategy ultimately proved untenable as interests of the state and those of Islamist actors began to diverge, especially with the onset of the Asian Financial Crisis, and implementation of IMF reforms.

Keywords: Asian financial crisis, IMF, Islamization, Malaysia, Pakistan, state power,