Contents

Acknowledgements
AfewQur'anic
versestoponder,at
thebeginningofthe
study
1.Introduction
2.Knowledgeof
Arabicandits
importance
3.BasicRulesTo
BeFollowedInThe
StudyOfThe
Qur'an

12. Economic system of the Qur'an

12.ECONOMICSYSTEMOFTHEQUR'AN1
12.1Introduction
TheQur'anprohibitsinterest(riba)inthestrongestterms.Therefore,thepillarofaneconomicsystembasedonthe
Qur'anmustbefundamentallyopposednotonlytothetotalrejectionofinterestinallformsbutalsoto
whateverthatbearsanyresemblancetoit.ThefollowingversesgivesomeindicationoftheQur'anicrequirements:
(2:278)Oyewhobelieve!ObserveyourdutytoAllah,andgiveupwhatremaineth(duetoyou)from
usury,ifyeare(intruth)believers.

4.Explanationof
theQur'anbythe
Qur'an

(2:279)Andifyedonot,thenbewarnedofwar(againstyou)fromAllahandHismessenger.Andifye
repent,thenyehaveyourprincipal(withoutinterest).Wrongnot,andyeshallnotbewronged.

5.Understanding
thefirstsura:Al
Fatiha,thekeyto
theQur'an

(3:130)Oyewhobelieve!Devournotusury,doublingandquadrupling(thesumlent).Observeyourduty
toAllah,thatyemaybesuccessful.

6.Basicteachings
oftheQur'an
7.Theprophetsand
theirrevelations
(7.17.7)

(4:61)Andoftheirtakingusurywhentheywereforbiddenit,andoftheirdevouringpeople'swealthby
falsepretences,Wehavepreparedforthoseofthemwhodisbelieveapainfuldoom.

7.Theprophetsand
theirrevelations
(7.8)

(30:39)Thatwhichyegiveinusuryinorderthatitmayincreaseon(other)people'spropertyhathno
increasewithAllahbutthatwhichyeinvestaszakat,seekingAllah'scountenance,hathincreasemanifold.

8.Topicsapparently
controversial(8.1
8.6)
8.Topicsapparently
controversial(8.7
8.11)
9.Latterdaysaints
10.Implicationsof
HadithforIslam
(10.110.2)
10.Theimplications
ofHadithforIslam
(10.310.4)
11.Thefivepillars
(11.111.3)
11.Thefivepillars
(11.411.5)
12.Economic
systemofthe
Qur'an
13.Lawmakingin
Islam
14.Qur'anand
Science
15.Thepurposeof
Mankind
16.TheIslamic
state
17.Islamand
humanrights

Note:Inverse30:39,thephrase'investinzakat'hasbeenusedinplaceofthetraditionaltranslation'givein
charity'.Section12.3.iiigivesthereasonsforthis.
Today,mostmoderneconomiesarebasedoninteresttosuchanextentthatitisdifficulttoimagineanyeconomic
activitywhereinterestwasnotinvolveddirectlyorindirectly.ManyMuslimshaveattemptedtoresolvethis
contradictionbetweenwhattheQur'andemandsandtheprinciplesofamoderneconomy,butasyetnoviable
systemhasbeendeveloped.ThesocalledIslamiccountrieswhichshookofftheyokeofcolonialismhave
remainedintellectuallyandeconomicallycontrolledfromoutside.Theconclusiononecomestoaftersuchalong
andsingularfailureonthepartofsuchcountriesisthatanysuggestedeconomicsystemcannotbeimplemented
andtestedwithoutthepriorestablishmentofatrueIslamicState(seechapter16).
DuringtheearlyyearsofIslam(i.e.thefirstfewhundredyears)whentheQur'anwastheonlysourceofguidance
fortheMuslims,aneconomicsystembasedontheQur'anwaswellestablished,andwithoutdoubtthiswouldhave
flourishedevenfurtherwithtime,ifonlytheMuslimshadnotdeviatedfromtheQur'an,andtherebylosttheir
statusasamajorworldpower.ThevacuumwhichresultedfromtheMuslims'neglectoftheQur'anandsubsequent
declinewasfilledbytheWestwhich,asweseetoday,hasaneconomylargelybasedoninterest.
ThebasisoftheidealeconomicsystemisintheQur'an.Asinmostthings,theQur'angivesthefundamental
principlesandleavesthedetailstobefilledinbyhumanbeingsaccordingtotheneedofthesociety.However,at
nostageoftheirexperienceshouldhumanbeingstransgressthefundamentallimitssetupbytheCreator.

18.TheJewish
scripturesandthe
Bible

12.2Thepresentday'sglobaleconomiccontrol

19.Human
evolution

Thefollowingsection(12.2.i)istakenfromanarticlenamed,Islam:TakingrootinEurope,bySahibMustaqim
Bleher.Thesectionfollowing(12.2.ii)includespartofanarticlepublishedinTheGuardianof9thJan.'87,byF.
ClairmonteandJ.Cavanagh,ontheunprecedenteddebtcrisisfacingtheThirdWorld,precededbymyown
comments.

20.Conclusion
Appendices(A1,A2,
A3,A4,A5,A6)
Bibliography
BookReviews(2nd
edition)
Questions
Shortdiscussions
MoonSighting

12.2.i
Everyideologyhasitsbasicunderlyingphilosophy:Capitalismemphasisestheindividual'freewill',
Communismequatesthevalueofmanwithhisproductivecapacity,andModernPhilosophystressesthe
relativityofeverything.TheunderlyingphilosophicalnotionofIslamisbalance.WhenAllahcreated
theworld,everythingwasinitsrightplace.Throughthesubsequentinteractionofnumerousentitiesand
forcesintheworld,thisorderiscontinuouslybeingdisturbed.Thebalancewillbelost,unlessanduntil
thisimbalanceisredressed,andhumanityreturnedontotheright,straightandevenpath.Thisprinciplecan
beappliedtoallspheresofhumanexperience.Theoverratingofmaterialadvancementhasstifledspiritual
advancementasaconsequence,uncontrolledpollutionhasdisturbedecologicalequilibriumgreedhas
producedaworldofcontraststhroughanunfairdistributionofresourcestheworld'sleadingsocieties'
carelesscomforthasbroughtwartothedoorstepsofcountlessnations.Inalltheseexamplesthevisible
imbalancecanbeequatedwiththeinjusticeofsometowardsothers.Torestorethebalanceinevitably
meansfightinginjustice.Islam,therefore,canneverbeamereprivatereligionpractisedinhomesand
monasteries.Ifitisnotpolitical,itisnotIslam.
TheQur'an'saccountofPharonicsocietytellsusthathumansocietyrestsonthreepillars:Thesocial,
politicalandmilitarysphere(representedbyPharaoh)theeconomicsphere(representedby
Qaroon/Corah)andtheideologicalsphereofeducation,religionandmediapropaganda(representedby
Haman).Thethreeareinterrelated,andthefightagainstoppressionwillremainunsuccessful,ifdirected
againstonewithouttheothertwo.Thisiswhathashappenedinthepast.Whenvariousbandsof
nationalismwithintheMuslimworldshookofftheyokeofcolonialism,theresultwasthecreationof
countrieswhichgotridofaforeignpoliticalelite,butremainedintellectuallyandeconomicallycontrolled
fromoutside.TheIslamicrevivalofvariousMuslimmovementsaroundtheworldconcentratedexclusively
onthespiritualaspectsofIslam,theneedfortherefinementoftheindividual'scharacter,andwas
consequentlyunabletofreeanybodyfrompoliticalandeconomicbondage.Muslimattemptsateconomic
reformswerelimitedtominorissues,fortheydidnotaddressthequestionofpoliticalandmediacontrol.It
seemsthatmost,ifnotall,theMuslimmovementsoverthelastfewcenturieshavebeenfooledbyWestern

divideandrulepolicyinthattheyadoptedadialecticallyandanalyticallyfragmentedapproachintheir
effort,ratherthantheholisticapproachthatIslamdemands.Modernmaterialisticsocietyhassuchrefined
mechanismsofcontrolinplacethatitsinjusticecanbepassedoffasajustcause.Itsrejectionofdivinelaw
andemphasisofindividualismrenderstheindividualisolatedandhelplessagainstbureaucratichuman
regulation.Itsmediapropagandamachineturnsfalsehoodintotruthbyeffectivelyfilteringallavailable
informationtoapermittednormaswellastwistingtheperceptionofeventsthroughclassicdoublespeak.
Itsevergrowingdrugsandnarcoticindustrysedatespeopletoapointwheretheybecomeindifferenttothe
sufferingofothers,unabletorelate,unmotivated,andturnalltheirpotentialenergiesforchangeinwardly
againstthemselves.Itspoliticalinstitutionsprovidejustificationofthemostperversedeedsofinjusticeby
anelaborateprocessof"decisionmaking"whicheffectivelyrubberstampsanyactiontheelitewishesto
take.Itseconomicsystemclearlyusestheinstrumentofinterestforcontinuingredistributionofwealth
awayfromitsproducerstoasmallcliqueofmonopolistswhohavemortgagedthelifeofalmostevery
individualonearth.
Presentdayglobaleconomiccontrolisamarvellousexampleofhowthemindcanbemadetobelievethingsthat
arenotreal.Itstartedwiththeearlygoldsmithswhotookpeople'svaluablesforsafekeepingintheirvaults.They
soonstartedtorealisethatnoneofthedepositorseveraskedforallthemoney/ormoniesback,butwithdrewsmall
portionsofitatatime,andtheycouldsafelylendtheremainderofpeople'smoneyagainstinterest,aslongasthey
keptenoughtomeetdaytodaydemands.Morethanthat,theycouldoftengetawaywithlendingmorethanthey
had,astherecipientofapromissorynotewouldnotnormallyexchangeitbackintocoin,butbehappywithatitle
deedtocoinagehethoughtwaskeptsafelyinthegoldsmith'svaults.Thus,thegoldsmithsbecamethefirstbankers
andgradually,bywayofdeception,defraudedmoreandmorepeopleoutoftheirhardearnedproperty.Withthe
widespreaduseofpapermoney,cheques,plasticcardsandelectronicmoneytransfers,thisbusinesshastakenon
giganticproportions,andbankersnowcontrolallsignificantenterprisesincludinggovernments.As,historically,
themoneylendingprofessionwasforbiddentoChristians,andstillis,orshouldbe,forbiddentoMuslims,Jewish
familieswerethefirsttoestablishthemselvesinthisbusinessandtodatecontrolitalmostexclusively.Little
surprise,therefore,thatZionismalmostalwaysgetsitswaywithgovernmentswhofindthemselvesinever
increasingdebt.
In1865AbrahamLincolnstatedhismonetarypolicy:'Moneyisthecreatureoflaw,andthecreationofthe
originalissueofmoneyshouldbemaintainedastheexclusivemonopolyofnationalgovernment.Money
possessesnovaluetotheStateotherthangiventoitbycirculation[...]Governmentshouldstandbehindits
currencyandcreditandthebankdepositsofthenation.Noindividualshouldsufferalossofmoney
throughdepreciationofinflatedcurrencyorbankruptcy.Governmentpossessingthepowertocreateand
issuecurrencyandcreditasmoney[...]neednotandshouldnotborrowcapitalatinterestasameansof
financinggovernmentalworkandpublicenterprise.'Thesewordsneednoupdatingoverahundredyears
later.ButLincolnwasassassinated,andmoneylendersstayedinpower.InAmericathispowerisexercised
bytheFederalReservewhichissuesthenation'smoneyinsteadofthegovernment.JohnF.Kennedywas
abouttotakethisrightawayfromthem,butthenhe,too,gotassassinated.Thismoneypowerhasupset
thebalancemorethananyothermeansofcontrol.Fertile,selfsufficientcountrieswereplungedinto
debtandmadedependentonoutsideaid.Yet,theWest'sincomefrominterestpaymentsisamultipleof
ThirdWorldAiddispatchedbytheWest.Onlytheinterestincomegoesontothelenders,whereastheaid
billisfootedbythepeopleandtheirgovernments.Consideringthatthisevilmoneypowerisattherootof
someoftheworstinjusticetroublingourplanetwar,pollution,starvation,socialdisorderMuslims
shouldbeamongstthefirsttofightit.Consideringthatthiscreationofmoneyoutofnothing,this
usurpationofwealthbycrookedmeansisalmosttakingtheshapeofplayinggodasignoftheDajjal,the
falseMessiahitshouldbethemostimportantissueontheMuslim'sagenda.Forgoodreason,interesthas
beenforbiddeninIslam.YetMuslimshappilyprayinmosquesbuiltwithinterestmoney,andthesocalled
Islamicbankshappilycontendthemselveswithtryingtobeattheothersatthegame.Insteadofofferinga
realalternative,theysimplychangethelabelsandshamelesslycallitfairpartnership,whentheygethalf
theprofitsofanentrepreneur'shardlabourafterlendinghimsomemoney,whichcostthemnothing.2
12.2.iiUnprecedenteddebtcrisisfacingtheThirdWorld
WenowturnourattentiontosomeoftheWesternnationswhopridethemselvesontheir'democracy'and
'freedom',yetwhoseattitudesandbehaviourtowardsothernationsoftenlackbothofthesevirtuesintheextreme.
Thereasonforthisisthatthepeoplewhogovernthesecountriescanonlystayinpowerbypromisingaconstantly
risingstandardofliving,whichinmostcasesisachievedbyrobbingtheThirdWorld.Mostoftheserichnations
behavelikemoneysharks.TheycorruptthepeoplewhoruletheThirdWorldcountriesbygivinghugeloansfor
importswhichinmostcasesthecountrydoesnotneedbutacceptsunderpoliticalcoercion.Thus,hugedebtsare
builtupunderpressure.Thepoliticalleaderscandoverylittletoresist,sincetheycorrectlysurmisethatthey
wouldbeliquidatedandthenreplacedbypeoplewhowouldagainbesubservienttotherichnations.Veryoften
theseThirdWorldleadersarepressurisedtohandoutcontractstotheforeigncountriesbyacceptinghugebribesas
wellasbytakinganundisclosedshareoftheprofits.ThishasmadeitimpossibleforanygenuineThirdWorld
leader,whowantstoimprovethewellbeingofhiscountrymen,tosucceed.
Ifsuchleaderssomehowsurvive,thentheyarebrandedascommunistorundemocraticinthepressandevery
possiblepressureisappliedtogetridofthem.Iwouldbefailinginmydutynottomentionthisgreatexploitation
andthetragicconsequencesthatareboundtofollow.Themoneylending,andthehugeinterestthatiscollected,
arecripplingthesecountries.Apointhasbeenreachedwherethecumulativeinterestpaymentsoutweighthe
originalloanandthedebthasbecomesobigthatitwouldbeimpossibletopaybacktheoriginaldebts,sothatthe
interestpaymentswillgoonforever.Theloansaredesignedsothatthemoneysharkscangoonmakingmoney
outofthemiseriesoftheThirdWorld.TheChurchseemstohavenothingtosayaboutthisglobalproblem.Below
IquotefromanarticlepublishedinTheGuardianof9thJan'87byF.ClairmonteandJ.Cavanaghonthe
unprecedenteddebtcrisisfacingtheThirdWorld.Itisalmosttenyearssincethearticlewaspublished.The
conditionofThirdWorldcountriessincethenhasgonefrombadtoworse,andtheonlyreasonforthis,isthe
exploitationthroughthemediumofinterestpayments,whichtheQur'anforbidsinnouncertainterms.
TheThirdWorldisfacinganunprecedentedfinancialcrisis,withitsdebtsgrowingexponentiallywhilstits
exportearningsareplummeting.Giganticamountsofcapitalarethusflowingfromthepoortotherich
countries.Theupshotisthatin1981,forthefirsttimeinpostwarhistory,ThirdWorldcountrieshave

becomenetcapitalexporters.Inotherwordstheirdebtservicepaymentsexceedednewborrowingand
rescheduling.Between1981and1985netcapitalexportforLatinAmericamovedfromUS$0.2to
US$42.4billionoran85foldincreaseinAfricafromUS$5.3billiontoUS$21.5billion,andAsiafrom
US$1.7billiontoUS$9.7billion.ThesenetcapitalflowsexcludeprofitrepatriationsbyThirdWorldbased
transitionalcompaniesandcapitalflights,aswellasMiddleEastexporters.Iftheseadditionswerethrown
intothescaletheaggregateoutflowswouldnotbefarshortofUS$230240billion.Thisisthesumfour
timeslargerthanthatoftheMarshallPlananditmustbeemphasised,theMarshallPlanaidwasrepaid
withinteresttotheUnitedStates.Incontrast,thistributefromthepoortotherichcountrieswillnotbe
repaid.Aggravatingthisterrifyingconfigurationisthedirectionoftheinternationalbanklendingwhich
toppedUS$216billionin1985.Theindustrialeconomies,asusual,absorbedalmostthetotality:US$194
ascomparedwithUS$119billionin1984.TheunderdevelopedtookonlyUS$3billion(1984):aderisory
sumamountingtoaround2percentoftheirglobalinterestpayments.Ofvitalimportanceistheroleplayed
bythecommoditypriceforecastsoftheWorldBank,whichsimplyhavenoclaimtoscientificvalidity.The
WorldBank'sforecastsofcommoditypricesweregenerallyhigherthantheactualpricemovementsofall
thecommoditiessince1980.ThefraudulentnatureoftheseWorldBankforecastsdesignedtoboostthe
oversupplyofcommoditiesandthuslowerpricesisbeingrecognisedbyagrowingbodyofintelligent
technocratsintheThirdWorld.Theoutcome,likeaGreektragedy,isineluctable:ThirdWorldcountries
areliterallybeingdriventomarketfatterandfattervolumesofcommoditiesatlowerandlowerpriceson
theglobalmarketinreturnforhigherpricedgoodsandserviceimports.Infact,neithercantheprincipal
northeinteresteverberepaid.Norisitdesirablethatthedebt(interestandprincipal)shouldberepaid.
DebtrepudiationstandsoutastheonlyethicallyfeasibleandrationalsolutionfortheThirdWorld.3
Similarexploitationissufferedbytheordinarypeopleevenwithintherichcountries.Rules,similartothoseused
againsttheThirdWorldareapplied.Thewholefinancialsystemisgearedinsuchawaythatitdisadvantagesthe
peoplewhoneedsmoneyasagainstthosewhoalreadyhavethesources.Eventhenewspapersrarelypublicisethe
enormoussufferingthatcommonpeopleundergoatthehandsofmoneysharks.SadlytheChurch,too,isentirely
silentontheseissues.
NowonderAllahhasforbiddenusuryandhasclearlystatedtheneedtousesurpluswealthforthebenefitof
humanity.
12.3SomeimportanteconomicconceptsusedintheQur'an
12.3.iCharity
(ApplicableuntilthetimewhenQur'anicSocialOrderisestablished).
12.3.iiSadaqaat
Paymentsforfulfilmentofcertainobligationoutofourincome,suchasoutofawage,adividend,abill,etc.
Sometimessadaqaatisalsousedasacharity.
12.3.iiiZakat
Paymentsbywayofinvestment,forthesakeofeconomicdevelopmentwhichessentiallyaimsatmaking
economicgainsforthebenefitofthesociety.
12.3.ivBusinessdealingandtrading.
12.3.iCharity
OncetheQur'anicsocialorderisestablishedtheneedforcharityshoulddisappear.However,duringthe
transitionalperiod,therewillalwaysbetheneedforcharity,butAllahlikestheaffluentpeopletopaythecharity
voluntarily,andbywayofexpressinggratitudetotheirCreator.Thefollowingversesexplaintheconceptof
charityinaGodfearingsociety:
(2:177)[...]Andgivethhiswealth,forloveofHim,tokinsfolkandtoorphansandtheneedyandthe
wayfarerandthosewhoaskandtosetslavesfree.
(76:8)Andfeedwithfoodtheneedywretch,theorphanandtheprisoner,forloveofHim.
(76:9)(Saying):Wefeedyou,forthesakeofAllahonly.Wewishfornorewardnorthanksfromyou.
Aselflessacttohelptheneedybreedstwoobviouselementsinthesociety:firstly,theneedyarehelpedinmaterial
termswhichgeneratesafeelingofcohesioninthesociety,andsecondly,thedonorgainsaspiritualbenefitinthat
hisdesireformaterialeffectsgetsbluntedwhichdivertshimfromobstructingthepathofthesociety.Indeed,it
causesareversalinthedirectionofpeople'sgreedwhentheycomeforwardtogiveincharityasamatteroffree
will,andasanexpressionoftheirgratitudetotheCreator.
12.3.iiSadaqaat
Pleaseseethefollowingversestounderstandthisconcept.
(9:60)Thesadaqaatareonlyforthepoorandtheneedy,andthosewhocollectthem,andthosewhose
heartsaretobereconciled,andtofreethecaptivesandthedebtors,andforthecauseofAllah,and(for)the
wayfareradutyimposedbyAllah.AllahisKnower,Wise.
(9:103)Takealmsoftheirwealth(sadaqaat),wherewiththoumayestpurifythemandmayestmakethem
grow,andprayforthem.Lo!Thyprayerisanassuagementforthem.AllahisHearer,Knower.
Theschemeissimpletounderstandprovidedhumanbeingsbelievethatitisonaccountoftheresourcesmade
availablebytheCreatorthatthematerialgainsareforthcominginthefirstplace,andashareoutofsuchgains
belongstoAllah,andthatthisshareistobespentforthegeneralwelfareofthesociety.Assuch,thepaymentas

sadaqaatinverses9:60and9:103hasbeentermedas'forthecauseofAllah'.Insimpletermssadaqaatmeansthe
taxpaidbythepeopleandbusinessesofthestatewhichmustthenbeusedforwelfarespending.Itmustbenoted
that,likemanyArabicwordshavingmultiplemeanings,sadaqaatcanalsohaveothermeaningsincluding
'charity',andthemeaningapplicableinaparticularcasedependsonthecontextinwhichitisused.
(57:18)Lo!Thosewhogivesadaqaat,bothmenandwomen,andlenduntoAllahagoodlyloan,itwillbe
doubledforthem,andtheirswillbearichreward.
Verse6:141belowexplainswhenthisDivineshareissupposedtobepaid:onthedayofharvesting.Intoday's
terms,itwouldmeanthetaxesthatonemustpaywhenonereceiveshispay.
(6:141)HeitisWhoproducethgardenstrellisedanduntrellised,andthedatepalm,andcropsofdivers
flavour,andtheoliveandthepomegranate,likeandunlike.Eatyeofthefruitthereofwhenitfruiteth,and
paytheduethereofupontheharvestday,andbenotprodigal.Lo!Allahlovethnottheprodigals.
ThisPaymentforAllahisapaymenttotheIslamicStateforthecommonwelfare.Bythesametokenpaymentsto
theMessengerinverses58:12,13meanspaymentstotheStateforthegeneralwelfare(astheMessengerwasthen
thecollectoronbehalfoftheState).
(58:12)Oyewhobelieve!WhenyeholdconferencewiththeMessenger,offersadaqaatbeforeyour
conference.Thatisbetterandpurerforyou.Butifyecannotfind(thewherewithal)thenlo!Allahis
Forgiving,Merciful.
(58:13)Fearyetooffersadaqaatbeforeyourconference?ThenwhenyedoitnotandAllahhathforgiven
you,establishworshipandinvestinZakatandobeyAllahandHismessenger.AndAllahisAwareofwhat
yedo.
ItisimportanttonotethatAllahenjoinsonMuslimmentoconsidermarriagepaymenttotheirwivesasaduty
(4:24),andthispaymenthasbeennamedassadaqaat(4:4).Inthiscasesadaqaatisnotacharitybutanobligation
whichmustbepaid.
(4:24)[...]Andthoseofwhomyeseekconsent(bymarryingthem),giveuntothemtheirportionsasduty.
Andthereisnosinforyouinwhatyedobymutualagreementaftertheduty(hathbeendone).Lo!Allah
iseverKnowing,Wise.
(4:4)Andgiveuntothewomen(whomyemarry)freegiftoftheirmarriageportions(sadaqaat)butifthey
oftheirownaccordremituntoyouapartthereof,thenyearewelcometoabsorbit(inyourwealth).

Mankindmustunderstandthecardinalprinciplethatapeacefulandastablesocietywillonlycomeintobeing
whenthereprevailsajustsocioeconomicsystem.Insuchasystem,wealthislikebloodforthehumanbody:
bloodmustcontinuouslycirculatethroughoutthebody,andmustreacheachandeverycellofthebody.Onlythen
willthebodycontinuetostayhealthy.Thehoardingofwealthislikethrombosis:aneconomicsystemwill
collapseifhoardingisallowedtopermeatesociety.ThisiswhyAllahforbidshoardingofwealthasthefollowing
versesshow.
(9:34)[...]ThosewhohoardupgoldandsilverandspenditnotinthewayofAllah,untothemgivetidings
(OMuhammad)ofapainfuldoom.
(104:14)Woeuntoeverygreedy,arrogant,onewhohathgatheredwealth(ofthisworld)andarrangedit.
Hethinkeththathiswealthwillrenderhimimmortal.Nay,butverilyhewillbeflungintotheConsuming
One.
InatrulyIslamicstatetherewillbesecurityforeverybody,andhenceanysurpluswealthwillbeinvested,thus
avoidingtheeffectofhoarding.Also,Allahlaysgreatstressuponthedistributionofwealthofadeceasedperson,
andtheQur'ancontainsextremelydetailedlawsofinheritance.Thisisavitalschemewherebythewealthofthe
nationstayswelldistributed,andtheformationofcartelsisnotpossible.Unfortunately,Muslimsdevisedwaysand
meanstocircumventthesevitaleconomicmeasuresbydefiningsadaqaatasvoluntarycharityandlimitingZakat
to2.5%ofsavingsandaccumulatedassetssothattherichcouldholdontotheirwealth.Incontrast,thewoman's
dowry(i.e.themarriagepaymentfromtheirhusband)inmostcasesremainanunclaimedcontract,whereasit
shouldbeinvestedforthewoman,asthemaintenanceofafamilyistheresponsibilityoftheman.Further,women
areoftendeprivedoftheirinheritancefromtheirparents'side,inspiteoftheQur'an'sclearinjunctiononthis.
12.3.iiiZakat
Literally,zakatmeansgrowth,purificationandrighteousness.AlShaukanigivesthefollowingdefinition:
'Linguistically,zakahmeansgrowth:OnesaysZakahhazZarmeaningtheplantgrew.Itcanalsomean
purification.InShariah(Islamiclaw)itimpliesbothmeanings.Thefirstmeaningisconstruedastocausegrowth
inwealth,orastocausemorerewardorastopertaintoincreasingwealth,suchasthecaseincommerceand
agriculture.'4
(30:39)Theusurythatispractisedtoincreasesomepeople'swealth,doesnotgainanythingwithAllah.But
ifyouinvestinzakat,seekingAllah'scountenance,thesearetheoneswhoreceivetheirrewardmanifold.
Bothzakatandusuryinvolvetheinvestmentofcapitalinordertoseekmaterialgains.Butwhereaszakatisa
methodofinvestmentapprovedbyAllah,usuryiscondemned.Theaboveverseindicatesthecardinalprinciple
thatthematerialgainsresultingfromthepracticeofusurygainnothingwithAllah,whereasthegains,resulting
fromthepracticeofzakat,receive'Allah'sblessing'.Insteadoffollowingthestraightinterpretation,the
Traditionalistswentinthedirectionoflinkingzakatwithverses9:60and9:103whicharerelatedtosadaqaat,and
extractedaninterpretationwhichledtocharitycollectionsbeingintroducedbytheState.Theywentsofarastofix
theyardsticksforsuchcharitycollections,andtoattributetheemergenceofthispracticetotheMessengerof
Allah.ItisunimaginablethattheMessengerofAllahwouldhaveintroducedaneconomicsystem,whereby

extracting2.5%oftheotherwiseillgottenwealthwouldrenderit'pure'!Afterhavingdemonstratedthatzakatis
somethingdifferentfromwhathadbeenordainedinverses9:60and9:103,wecometoverse2:177which
indicatesthatevenafterspendingincharity,outofownvolition,thereissomethingcalled'zakat'whichwillstill
beoutstanding.Verse22:41ordainsthatthetruebelieversarethosewho,whenallowedpowerandinfluence,
establishasystemof'zakat'intheirwayoflife.
(22:41)Thosewho,ifWegivethempowerintheland,establishworshipandinvestinzakatandenjoin
kindnessandforbidiniquity.AndAllah'sisthesequelofevents.
Verse22:78furtherconfirmsthisOrdinance.
(22:78)[...]Soestablishworship,investinzakat,andholdfasttoAllah.HeisyourprotectingFriend.A
blessedPatronandablessedHelper!
Hereisalistofreferenceswhichdealwithzakatdirectly:2:43,83,110,177,2774:1625:127:1569:5,11,18,71
21:7322:41,7824:37,5627:331:433:3341:7.
Zakatpreventshoardingofmoneyandcausesthewealthtogrowsothatpeoplecanearntheirliving
insteadofdependingoncharity.Anotherwayoflookingatzakatisthatifthesparecashissimplygivenawayin
charitythen,inthelongrun,thepersonmaynotbeabletogiveincharitybutmayhimselfbecomedependanton
charity,duetohiscircumstanceschanging.However,ifzakatisusedasaninvestmentforgrowththenonecanstill
liveamodestlife,andhelpthesocietyincreatingemployment,sothatthepeopledonotneedtodependon
charity.Atthesametimethequestionofhoardingisremoved.Zakatasaninvestmentthereforefulfilsmanyofthe
Qur'anicrequirements.
Note:ThereareversesintheQur'aninwhichtheword'sabeelillah'appears.Forexample:
(2:261)ThelikenessofthosewhospendtheirwealthinAllah'sway(sabeelillah)isasthelikenessofa
grainwhichgrowethsevenears,ineveryearahundredgrains.AllahgivethmanifoldtowhomHewill.
AllahisAllEmbracing,AllKnowing.
(4:160161)BecauseofthewrongdoingoftheJewsWeforbadethemgoodthingswhichwere(before)
madelawfuluntothem,andbecauseoftheirmuchhinderingfromAllah'sway(sabeelillah).Andoftheir
takingusurywhentheywereforbiddenit,andoftheirdevouringpeople'swealthbyfalsepretences.We
havepreparedforthoseofthemwhodisbelieveapainfuldoom.
(47:38)Lo!YearethosewhoarecalledtospendinthewayofAllah(sabeelillah),yetamongyouthereare
somewhohoard.Andasforhimwhohoardeth,hehoardethonlyforhissoul.AndAllahisRichandyeare
poor.AndifyeturnawayHewillexchangeyouforsomeotherfolk,andtheywillnotbethelikesofyou.
Theliteralmeaningofsabeelillahis'Allah'sPath'.Traditionalistsconsiderthissynonymouswithcharity,even
thoughinthewholeoftheQur'anthiswordhasneverbeenusedinthatmeaning.Effectively,itmeansspending
freely:money,time,wealthoranything,inthepathofAllah.
12.3.ivBusinessdealings(baiy)andtrading(tejarat)
Businessdealingsandtradingaretwodifferentpracticesasindicatedinthefollowingverses:
(24:37)SuchpeopleasrememberAllahwhiletradingormakingbaiy[...]
Thenearestconceptofbaiyinthisverseisbusinessdealingwhichpertainstothedealingswithmoneywherethe
exchangeofcommodityisnotinvolved.Outwardly,itwouldlooksimilartothepracticeofusury.However,ithas
asubtleandvitaldifference.Whenweunderstandthis,thewordingoffollowingversebecomesclear.
(2:275)[...]Theysaybaiyisjustlikeusury:whereasAllahpermittethbaiyandforbiddethusury[...]
Asanexample,amodelofmoneylendingbasedonbaiywouldbethatprofitsandlosseswouldbeshared
equitably.Alternatively,torepaytheloaninsuchawaythatitretaineditsoriginalpurchasingpower.Therecould
benoquestionofrepayingindevaluedmoney.Incontrast,moneylendingbasedonusury,wheremoneyislentat
anagreedrateofinterest,wouldbeindependentofwhethertheborrowermakesaprofitorlossoutofthemoney
lent.
Verse2:282belowclarifiesbaiyasessentiallyapracticeofmutualagreementdesignedtolastoveraperiodof
time,whichtherefore,mustbesignedandwitnessed.Tradingontheotherhandmaybelongtermoracrossthe
table,whereacommodityisexchangedformoney.Itexcludesthepracticeofmoneydealing,withoutinvolvement
ofcommodities.
(2:282)Oyewhobelieve!Whenyecontractadebtforafixedterm,recorditinwriting[...]Andcallto
witness,fromamongyourmen,twowitnesses[...]
12.4Qur'anicschemeofeconomicssummarised5
1.Freeenterpriseandrighttopersonalholdingsbutinarightfulway.
2.Lendingorborrowingofmoneyonfixedinterestisforbidden.Usuryinanyformisnotallowed.
3.Usurytobereplacedbyzakat.Moneytobeinvestedfreely,eitherdirectlyorthroughtheintermediariesknown
asBaitulMals(banks)andtoshareprofitsandlossesoftheinstitutionwheremoneyislent.Otherclerical
servicesliketransfers,letterofcredit,licensingshouldbeperformedonthetarifftobeapprovedbythe
government.
4.IndividualspayincharityinthemannerordainedintheQur'an(see12.3.i),andmustmaintaintheinstitutionof
freewillandafreesumofmoney:theQur'anhasadepthofinsightnottofixaprecisepercentage.Itshouldbe

differentfrompersontopersonandfromtimetotime,theprincipleaimbeingtheprocessofreversalofgreed.
5.TheStatewouldtakebywayoftaxesfromthesocietywiththeprimaryintentionofremovingexcessand
redistributingwealthforgeneralwelfare(see12.3.ii).
6.Nooneshouldbeabletosellsomethinghehadn'talreadyboughtorpaidfor.Itwouldnotbepossibleto
speculatein'futures'asisdoneintheWest,thatis,withouteveractuallyowningthegoods.Thefortunesmen
makeintheCityofLondonbyfinancialtransactionswhichwouldbestrictlyforbiddenbyIslamicLaw.
7.Freshmoneywouldonlycomeintocirculationwhengoodsandservicesofthecorrespondingvaluehadbeen
inductedintothesociety.Thiswouldeffectivelycheckpricespirals,inflation,collapseofcurrencies,etc.
Distributionoffreshmoneycomingintocirculationwouldbeonmutuallyagreedbasisbetweenthesociety
members.
8.Anairofconfidencewouldemergesothatpeoplewouldcomeforwardwillingly,andmakeinvestments(see
12.3.iii).
AneconomicsystembasedontheQur'anicprinciplesofanequitablesocietyandproductiveinvestmentcan
effectivelyremovemuchofthechroniceconomicillnessesassufferedbythemodernsociety.
References:
1.FreedomforQur'anbyAhmadNawazandpublishedbyAhmadNawaz.Mr.Nawazhasdedicatedhisbookfor
theserviceofmankindandassuchthereisnocopyrightrestriction.Thebasicconceptsarebasedonthisbook.
2.Islam:TakingrootinEuropebySahibMustaqimBleher.Publishedby'IslamicPartyofBritain'intheirofficial
PartNewsreport,'CommonSense'datedLastQuarter1992.Issuenumber8.p.10,11.
3.TheGuardian:(i)Newsitemonfrontpagedated7.3.87.(ii)PassagesfromthearticleImpossibleDebton
RoadtoGlobalRuinbyF.ClairmonteandJ.Cavanagh,dated9.1.87.
4.ZakahbyAbdulRehmanAnsari.PublishedbyIPCI,481CoventryRoad,SmallHeath,BirminghamB100JS.p.
5.
5.FreedomforQur'anbyAhmadNawazandpublishedbyAhmadNawaz.p.167169.

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