Economy is perhaps the most important area of human civilization as it involves short-term as well as long-term management, production, distribution and consumption of articles necessary and essential for human existence and survival. It has always been an important issue throughout the history of mankind — even in the ‘pre-money’ days. But since the introduction of coins and notes as legal tender economics has assumed an even more important place in human life. The Quran has rightly treated this subject at length and with the seriousness it deserves. In fact, the entire structure of the Quranic society rests on its economic base. But, before we look at the system of economy proposed by the Quran, let me very briefly retrace the two dominant, prevalent, and rival economic systems operating in the world today.

Two economic systems current in the world.

Capitalism

It is the economic system currently in place in the majority of countries around the globe.1 Capitalism rests on the fundamental principle of the sanctity of private ownership. It means that the worker is the sole owner of whatever they may earn or make by way of money.2 Also, the owner has the legal and sole right to dispose of their earnings in the way they see fit. They may spend all they have earned or save some of it. This extra which may be saved forms the second foundation stone of capitalism. Any savings may be invested to generate more money. The sum of money invested is known as ‘capital’ — hence the term capitalism’, and the money it generates is called ‘interest’. The capitalistic economic system is also referred to as 'free economy'3.

Socialism

As opposed to capitalism, socialism bases itself on the idea of ‘collective’ or ‘social’ ownership. No citizen can own anything. Everything is owned collectively by society under state control of short-term as well as long-term management, production, distribution and consumption of wealth.4 The system is based upon the Marxist principle of ~from everyone according to capacity and to everyone according to need’. Also known as ‘controlled economy’5, socialism is in force in several countries like China, Cuba and most notably, until recently, in the demised and dismembered USSR.

After this brief reminder of the two prevalent economic systems, let us turn to the Quran. But, before we get to it. let me dwell for a moment on the Arabic word commonly used for ‘economy’ or ‘economic system’. It is iqtesaad. it springs from the three-letter root Qaaf— Saad — Daa with the basic meaning of ‘to intend, to prepare to do something, to get ready to do.'6 Al-qasdu flu amr means ‘to adopt a middle and balanced approach. Therefore, iqtesaad is a balanced system of economy.

II Introduction: Two important points.

One: The Concept of Life

What is ‘life’? What constitutes a ‘human being’? Why are we here? Where are we going? Why was this universe created? Questions like these may be answered according to the materialistic concept of life: Man is a highly developed (social) animal, comprised of certain chemicals arranged in a certain proportion. These chemicals disintegrate when the body reaches the end of its natural life (death) and that is it. Dust is returned unto dust, in the Biblical expression. But the Quran offers the spiritualistic concept of life:

1 Life is going through evolution and Man still has to undergo further evolu*tionary stages:

‘It is He Who bath produced you from a single soul; then there is a resting place and a repository....' Al-An ‘aam (6:98)

2 Evolution is the decided path of life:

‘Ye shall surely travel from stage to stage.’ Al-Inshiqaaq (84:19)

3 Life does not end with death; it goes on:

‘Again, on the Day of Judgement , will ye be raised up.’ Al-Mo ‘menoon (23:16)

4 Man is made up of two things, a body and a personality, which is called an-nafs8 by the Quran:

‘By the soul (ego or personality), and the proportion and order given to it.’ Ash-Shams (91:7)

5 This ego / soul / personality has been given to Man as the Divine Energy called rooh and was breathed into Man at birth:

‘But He fashioned him in due proportion, and breathed into him of His spirit.....’ As-Sajda (32:9)

6 In a nutshell, the Quran states its concept of life, death~, and personality (consciousness) thus:

‘It is Allah that takes the souls (of men) at death, and those that die not (He takes) during their sleep; those on whom He has passed the decree of death, He keeps back (from returning to life), but the rest He sends (to their bodies) for a term appointed.’Az-Azumr(39:42)

7 The Divine Energy (rooh) gives Man his self /ego / personality, which has endowed him with the characteristic of FREE WILL. Man has the capacity and potential of choosing his own actions and shaping his own destiny:

‘We showed him the Way: whether he be grateful or ungrateful.’Ad-Dahr (76:3)

8 By being grateful (choosing the right way, which is recorded in the Quran), Man can develop his soul so that his life can go on to the next stage of Evolution (the Hereafter), where there will be no death:

"Is it (the case) that we shall not die, except our first death..?"10As-Safaat (37 : 58,59)

9 Real life is in the Hereafter:

‘What is this life of this world but amusement and play? But verilythe Home of the Hereafter,- that is Life indeed, if they but knew.’Al-Ankaboot (29:64)

10 Development of Self

Now we come to an important question. How does one develop one’s soul I self! personality / ego so that one’s life can continue after death?The human instinct is to seek self-gratification. In the physical universe the body thrives on whatever it takes for itself But in the spiritual world the soul/self gets developed by whatever is given to others. Greed and selfishness destroy the soul and any chances of its development:

‘...and entertain no desire in their hearts for things given to (others) but give them preference over themselves, even though poverty was their (own lot). And those saved from the covetousness (greed) of their own souls (selves), - they are the ones that achieve prosperityt.’Al-Hashr (59:9)

11 And how exactly is it done? Through anfwzq!

‘So fear Allah as much as you can 11; listen and obey; and spend in charity for the benefit of your own souls. And those saved from the covetousness of their own souls, - they are the ones that achieveprosperity.’At-Taghaabun (64:16)

12 What is anfaaq?

Nafaq is a tunnel (open at both ends) as opposed to sarab, which is a cave (open only at one end). Munaafiq is a person who enters a system through one opening and slips out through another. Anfaaqfi sabeel Allah is the practice of keeping open and available Allah’s bounties for everyone:

‘Say: “If ye had control of the Treasures of the Mercy (benevolence)of my Lord, behold, yewould keep them back, for fear of my Lord, behold, ye would keep them back, for fear of spending them: for man is (ever) niggardly!”’ Beni Israel (18:100)

13 anfaaq is meant for Man’s own benefit:

‘...Whatever of good ye give benefits your own souls (selves)....’ Al-Baqara (2 : 272)

Two: God’s Law enforced by Man

The second important introductory point is that Nature’s law takes effect auto*matically in the physical world (non-living as well as living matter). But in the human social world God’s law has to be introduced, implemented and established by humans themselves. When Man establishes God’s law in human society, he re*presents God Himself

‘It was not ye who slew them; it was Allah; when thou threwest (a handful of dust) 12, it was not thy act, but Allah’s....’ Al-Anfaal (8:17)

Man’s hand becomes God’s Hand:

‘Verily those who plight their fealty to thee plight their fealty in truth to Allah: the Hand of Allah is over their hands: ‘Al-Fath (48:10)

Man has the duty to perform God’s duty in human society:

‘And why should ye not fight in the cause of Allah and of those who, being weak, are ill-treated (and oppressed)? — Men, women, and children, whose cry is: “Our Lord! Rescue us from this town, whose people are oppressors; and raise for us from Thee one who will protect; and raise for us from Thee one who will help!” An-Nisaa (4:75)

Bearing these two important introductory points in mind, let us turn to the topic proper, i.e. the economic system of the Quran.

III The Economic System of the Quran.

When the Quranic social order is established in a human society, one of the basic responsibilities of the authorities is to provide rizq13 (universal sustenance):

‘....We provide sustenance for you and for them (your children)...’Al-An’aam (6:151); also Beni Israel (17:31)

This monumental task of providing sustenance is not limited to humans and extends to include all living beings all over earth:

‘There is no moving creature on earth but its sustenance dependeth on Allah:...’14Hood (11:6)

Omr ibn Al-Khattaab, the second successor of the Messenger is reported to have said: “Even ~f a dog dies of starvation on the banks of Furaat, 15Omr will have to be answerable for it on the Day of Judgement,"16

Responsibilities of the Quranic government.

This chief responsibility of providing universal sustenance is assumed under the over-all charter of the Quranic government:

‘Allah has promised, to those among you who believe (are convinced) and work righteous deeds, that He will, of a surety, grant them in the land, in*heritance (of power), as He granted it to those before them; that He will establish in authority their religion (system) — the one which He has chosen for them; and that He will change (their state), after the fear in which they (lived), to one of security and peace; they will worship (obey) me (alone) and not associate aught with Me. If any do reject Faith (the system) after this, they are rebellious and wicked.So establish As-Salaa and Az-Zakaa and obey the Messenger; that ye may receive mercy.An-Noor (24: 55, 56)

Establishing a fair and universal system of sustenance.

And how is this practically done?

‘Allah hath purchased of the believers (convinced) their persons, and their goods; for theirs (in return) is the Garden (of Paradise):...’ At-Tauba (9: 111)

This Garden of Paradise (Janna) is bestowed upon the Convinced (Momeneen) by God in the Hereafter but in this earthly life it is established as a just, fair and comprehensive social order in which, among other things:

‘...and eat of the bountiful things therein as (where and when) ye will...’ Al-Baqara (2:3 5)

and:

‘There is therein (enough provision) for thee not to go hungry nor to go naked, nor to suffer from thirst, nor from the sun’s heat’Tahaa (20: 118, 119)



The Constitutional Framework

1 No private ownership

‘...His are all things in the heavens and on earth...’ Al-Baqara (2:255), etc

To properly carry out this huge universal task of comprehensive welfare of its people the Quranic state has to keep under its control all the sources and means of production of wealth. The ultimate source of all, or most, wealth is LAND / EARTH. Therefore, no one can own land as all land (the entire earth) belongs to God. Earth has been called ardellah Ai~aWs earth~ nAl-’Araaf (7: 73~. ~lso:

‘It is We Who will inherit the earth and all beings thereof....’ Maryam (19:40)

The produce of earth is for ALL:

‘And We have provided therein means of subsistence, - for you and for those for whose sustenance ye are not responsible.And there is not a thing but its (sources and) treasures (inexhaustible) are withUs; Al-Hajar...’ (15: 20, 21)

Therefore. the earth and its produce must remain open and accessible to ALL. It is Sawaa a us Saaeleen — alike for all for the asking! Ha-Meem / Fussilat (41:10)

2 Wages of labour

The second fundamental principle is that one is only entitled to any wages (money) earned through labour (work):

‘That man can have nothing but what he strives for.’ An-Najm (53:39)

And why not?

‘See ye the seed that ye sow in the ground?

Is it ye that cause it to grow, or are We the Cause?

Were it Our Will, We could make it broken orts; and ye would be leftin wonderment,

(Saying), “We are indeed left with debts (for nothing):

Indeed we are deprived.”

See ye the water which ye drink?

Do you bring it down (in rain) from the Cloud or do We?

Were it Our Will, We could make it saltish (and unpalatable): then why

do ye not give thanks?

See ye the Fire which ye kindle?

Is it ye who grow the tree which feeds the fire, or do We grow it?

We have made it a reminder and an article of comfort and convenience for the denizens of deserts (the needy of the world).’ Al-Waaqea (56: 63-73)

3 Interest

INTEREST I USURY is absolutely forbidden and deserves Hell:

‘0 ye who believe (are the Convinced)! Devour not Usury, doubled and multiplied; but fear Allah; that ye may really prosper.And fear the fire, which is prepared for those who reject Faith (the system).’ Aal-e-’Imraan (3: 130, 131)

That is why there can be no ‘investment’, in the modern economic sense of the term, to make money as an absent partner:

‘That which you give in usury (interest) for increase through the property (wealth) of (other) people, will have no increase with Allah....’ Ar-Room (30:39)

1 It is reported in Musnid Abu Daood that the Messenger said, “Surely,earth is Allah's and the people are (also) Allah's

2 That is why he declared as unlawful the practice of sharing the yield of land as an absent partner by saying:

“Whoever has land must either work on it himself or hand itover, free, to a (Muslim) brother of his.”

(Muslim; Abu Daood)

3 It is reported in Nisaee that the Messenger was asked,‘Is the owner of land entitled to take a little grain off the farmer?’

He said, “No.”

He was then asked, “Not even hay ?”

He replied, “Absolutely not.”

4 Surplus Wealth

The principles mentioned above spring from the basic rule that nobody needs more money than that required to meet their needs, as all their welfare will be taken care of by the State. Therefore, every able-bodied citizen is expected to work according to capacity and is entitled to only what his needs require. So, everyone is required to surrender to the State all the wealth they produce except what is necessary to meet their needs:

‘They ask thee how much they are to spend (keep available for others); Say: “What is beyond your needs.”17 Al-Baqara (2: 219)

It is the responsibility of the Quranic Government to administer this system:

‘Take (from them) what is surplus (of their needs); and command what is right;’ Al- ‘Araaf (7: 199)18

5 Banks

The expression ‘Islamic Banking’ is a classic example of contradiction in terms. It is akin to ‘Islamic Pub’ or ‘I-lalaal Swine.’ Since there will be no surplus wealth with anyone. and interest being forbidden, there is absolutely no place for institutions like banks in the true ultimate Quranic order of things.

6 Easy Wealth

In the light of the principle of labour, easy money cannot be made in the Quranic society:

‘They ask thee concerning wine (intoxicants) and gambling, 19 Say, “In them is great sin, and some profit for men; but the sin is greater than the profit.” Al-Baqara (2: 219)

and

‘0 ye who believe (are Convinced)! Intoxicants and gambling, sacrificing to stones, and (divination by) arrows, are an abomination, - of Satan’s handiwork: eschew such (abomination) that ye may prosper.’Al-Maaeda (5: 90)

That is a brief introduction of the economic system of the Quran which it expects men to establish in the ultimate fair and just human society.