Economic System of Riyasat e Madina

(Dr.Mehboob Syed, Karachi)

A complete solution of Human economic Problems

Islam is a complete code of life. It gives divine guidance and provided a complete practical model in the life and practices of Prophet Muhammad (Peace be upon him) for all human beings till the Day of Judgment. It could be applied in each and every era. It also gives a complete economic system whenever and where ever is followed could solve the all major problems of human beings which they face in capitalism and communism. This system can be tracked back in Riyast e Madina (The state of Madina) where and Islamic society and government was formed based on Quran and Sunnah. This economic system eliminated all sort of inequalities, oppression, and economic injustices. There is no precedence of Nizame Akhuwa (The system of brotherhood) which was formed by Prophet Muhammad (Peace be upon him) between the Ansars (Madanians) and Mohajirs or immigrants (Makkans). Here was sharing between haves and not haves which led towards the success of Riyasate Madina and paved the way for it to become one of the greatest powers of its time.

Pakistan came into being on 14th August,1947 after a long struggle, unprecedented sacrifices in modern history on a promise that we have to implement an Islamic system based on justice, equality, free of all sorts of oppression, providing opportunities of growth, employment, development to every of its citizen without any discrimination and minorities would be given freedom, protection of their life, property and honour on the basis of Islamic teachings and following the noble example of beloved Prophet Muhammad ( Peace be upon him) . The founder of Pakistan on the occasion of inauguration of State Bank of Pakistan clearly mentioned that the contemporary capitalism and communism both bitterly failed to resolve problems being faced by human being while actually they added to the wounds of human beings and we have to find the solution of these economic problems in Islamic economic system.

So in the light of this desire of the originator of Pakistan Islamic scholars worked diligently and tried their best to answer the question of economists about the system of economic based on Quran and the Sunnah of Prophet Muhammad ( Peace be upon him).

In this research essay we will try to explain the economic system of Riyasat e Madina or Islamic State of Madina.

Islamic Theory of State
In sura e Noor Allah Almighty had said “ Those among you who accept faith Allah Almighty had promised to them that He would provide them Khilafat similarly as He provided to previous faithful.

This ayah gives the base of theory of Islamic state and Khilafat (Vicegerency) term has been used.

In the light of this verse the base of Riyasate Madina was on God fearing, Taqwa and there was no superiority on the basis of caste, wealth, tribe or clan. Islam divided human beings into two groups: Those who believe in Almighty Allah, His Prophet, and the Day of Judgment and are God fearing and those who do not believe in Allah Almighty, refuse His prophet and indulge in bad deeds. The social and economic status of anyone was not barrier to give him any responsible position therefore may those who were slave had been given the post of army chief, governor and those who were from high social and economic back ground followed their command.

The Real Master and owner of Factors of Production

Unlike in capitalism and communism Islamic concept of ownership of factors of production is that only Allah Almighty is the real and absolute owner of these and He entrusted these to human beings as His Amanah and these has to be used according to the command of Allah and His Prophet. Weak and vulnerable have right in the resources of state. The Prophet Muhammad (Peace be upon him) categorically said that those who left debt and have no resources to pay back the bereaved family should come to me I will pay their debt.( Sahih Muslim)

Concept of Halal and Haram
In Riyasat e Madina every one was clear about the concept of halal, producing selling of wine was strictly prohibited and there was very harsh punishment for those who indulge in these sins. Wine was considered “Ummul Khabayas” (The mother of all sins), gambling, infiltration, adulteration, prostitution and all those ways of earning which involve oppression of other people. Similarly like earning spending were too have some limitations. One was suppose not to spend on gambling, buying wine, prostitution besides Israf and luxuries was too discouraged. Islam stress simplicity and Prophet Muhammad (Peace be upon him) himself as head of Riyasat e Madina lived a very simple life and while he was sitting with his Sahaba the companions it was difficult to distinguish him from others.

Distribution of Wealth
Islam has given a just system of distribution of wealth which was implemented in Riyasat e Madina and set a precedent which if followed by Pakistan it can resolve most of its economic problems. There was no feudalism and wealth was not concentrated in few hands. Resources of state were allocated in way that no one was deprived. Economic satisfaction level was at the highest. About wealth and resources everyone had fear of God; there was no race of accumulating wealth contrary to this there was competition of spending in the way of Allah and on good deeds. Hazrat Umer (May Allah be pleased with him) was always tried to beat Hazrat Abu Bakr (May Allah be pleased him) in spending in the ways of Allah. There was a Bait ul Mal (Islamic exchequer) dedicated to fulfill the needs of needy people. People were allowed to keep their property but all Sahibe Nisab (those who seven and half tola gold or equal to this) have pay Zakat.

The System of Zakat
Zakat and Infaqe fi sabeel Lillah is the best solution of poverty alleviation. This System of zakat fully implemented in Riyasat e Madina, this was the best way to pass wealth from haves to not have. Zakat was not a tax which is paid mostly reluctantly even in developed world day not to speak of developing and least developed country where mostly avoid paying taxes. Zakat has many virtues and religious obligatory duty of every rich Muslim. It has enormous reward for its payee in life after death. So everybody was pleased to pay zakat and besides Zakat every one tried to give Zakat. Zakat was paid to poor, orphans, widows, prisoners, travelers and needy people. Zakat is a major bearer to concentration of wealth into few hands and it circulate wealth from rich to poor, from haves to not haves.

Distribution of wealth in inheritance
After the death of the owner of wealth or property it was distributed among his/her parents, sons, daughters, wife or husband in way that it discouraged concentration of wealth and encouraged to disperse it. Right of Weak and vulnerable was also protected.

Prohibition of Interest and Usury
Oh those who believe fear Allah and give up what still remains of the Riba if you are believers. But if you not, then listen to the declaration of the war from Allah and His messenger. And if you repeat, yours is your principal. Neither you neither wrong nor be wronged. [278-279]

Riba, usury or Interest concentrates wealth in few hands, it is the major source of exploitation and oppression, it transfers wealth from poor to rich, it enables rich to be richer and poor to be poorer. It was strictly prohibited in Riyasate Madina.

Consequences of Riba free Economy
Riba free economy was resulted in equality, justice and satisfaction of the masses. The society was so exemplary that later it was followed by Scandinavian countries which called themselves Welfare States. Umer laws were implemented in these countries which enabled them to be place at the highest Human Development index. Pakistan has a feudal economy cum colonial style capitalism which needs to be replaced with Riba free economy based on the model of Riyasat e Madina. Unfortunately interest rate has been doubled since last year, prices of essential items including lifesaving medicines have been doubled , rupee has been devalued more than 35% percent which increased cost of loving as well as cost of doing business. They way of salvation is only Islamic Economic System the sooner we adopt it the sooner we will come out of crisis.

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17. An Introduction to Islamic Finance Mufti Taqi Usmani

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مزہبی کالم نگاری میں لکھنے اور تبصرہ کرنے والے احباب سے گزارش ہے کہ دوسرے مسالک کا احترام کرتے ہوئے تنقیدی الفاظ اور تبصروں سے گریز فرمائیں - شکریہ