Mr.Waheed and Mr.Hameed are business partners and run a brokage house by the name of "Securities and Exchange Pvt. Ltd" with head office in Sydney Australia. They are thinking about expanding their business by opening a branch in Pakistan.

They have previously been dealing in derivative instruments (like futures and option contacts) for purpose of hedging their business risk. Both are off view that there is no harm in derivative trade as it is essential part of international business and if you can manage it than it very profitable business. Especially since both are pro risk and have firm believe that higher the risk greater the reward.

They have reached a decision that the Pakistani branch will only deal with Islamic derivative products. You have received an interview call from "Securities N Exchange Pvt ltd". The interview is held in Marriot hotel Islamabad and panel comprises of Mr.Waheed and Mr.Hameed and Mr.Dilawar Khan (who is well versed in Islamic fianc). After general interview you have been asked following questions.

i) Explain the principles of Islamic finance applicable to derivative products.

ii) Can Ba'i Salam be termed as Islamic version of futures contract, if yes please explain.

iii) What are the basic conditions for Ba'i Salam contacts? Differentiate it from Istisna.