An Introduction to Islamic Finance: Theory and Practice

(Romina) #1

The Economic System 55


basic Islamic values, which, ipso facto, represent the growth of a Muslim per-
sonality. The well-knit way of life in the Islamic community molds individual
behavior in its own design. Islamic principles, which deal with the formation,
preservation, and continuation of the Islamic community, refl ect the dialectic
interaction of psycho-physiological requirements of individuals, on the one
hand, and the necessary socioeconomic order envisioned by Islam, on the
other. This interaction is absolutely crucial to the development of behavior,
including its economic dimension, of the individual and the collectivity envi-
sioned by Islam.
Inasmuch as Islam’s greatest emphasis is on the development of the indi-
vidual’s active moral consciousness in all his/her social interactions, the exis-
tence of political authority in society does not absolve the individual of the
performance of duties with which he/she is charged. Adherence to moral
principles and the doctrinal antecedence logically predispose a Muslim to an
active and assertive political role in society. It is the active moral conscious-
ness of the individual and the duty of “commending the good” and “forbidding
of evil” which give the individual Muslim the right and the obligation to
participate in the affairs of the community.


THE POLITY


Islam considers justice as the foundation of the polity. The Unity of Religion
and the Law, which exists in principle, must be carried out in practice.
Without an organized political authority the existence of both Religion and
the Law may be endangered; without the constraints of the Shari’ah, the
polity will degenerate into an unjust and tyrannical political order. Only
in pursuit of justice can the polity be expected to fulfi ll the ends for which
it was established. The pursuit of justice results in a convergence between
the interests of the ruler and the ruled, leads to the improvement of social
and economic conditions, and enhances the power of Islam in society. Two
factors are necessary for this: the moral consciousness of the individual in
not transgressing the limits set on their behavior by the Shari’ah and the
faithfulness of the political authority to the terms of its contract in ensuring
that the rules of the Shari’ah are implemented.


ENDNOTES



  1. This concept was originally articulated by As-


ˇ
Sahid As-Sadr (M.B.) in Iqtisa-
duna (1987). Along with the fi rst two principles of property, this provides the
justifi cation for the dictum that in the property of the rich there is a right for the
poor and serves as the basis for legislation empowering transfer of income and
wealth as well as rules against waste and extravagance in consumption.


  1. In a direct, clear, and unambiguous verse (6:152), the Qur’an commands:
    “... fulfi ll the Covenant of Allah.” In an equally clear verse (5:1), it generalizes
    this imperative to all contracts: “... fulfi ll all contracts.”

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