04-24-2004, 09:05 PM
Salam Folks,
Even though I have strong arguments against the existing theories declaring interest as it is as Riba and thus haram, still I am not indulged in interest based activities taking heed from the hadith which can be summarised as "If you have a doubt about something, leave it..." Excuse me as I am not able to recall it corectly and fully.. Would just like to add some dimensions to the discussion
Economics is actually the subject here, and not banking and acounting. If you refer any book of Economics, you will find FOUR factors of Production namely LAnd, Labour, Capital and Organisation. In order to produce an economic good, one or more of above factor is needed. Now each factor comes with a price. Land is paid Rent, LAbour is paid wages, Capital is paid interest and Organisation is paid Profit. People who wish to remove capital, a basic factor, are destroying the very foundation of economics. Thus, this utopian so called Islamic economic system wont work in the absence of capital.
Quran declares Riba as haram. In english we have two words (i) Interest (ii) Usury. I believe that its this Usury which is haram and not interest. Usury is that exorbitant rate of interest which defeats the purpose of national economic development and well being of society as a whole and is descriminatory and exploitory in nature. ISlam protects a poor and needy from exploitation. In the times of prophet Muhammad (saw), such interest was enforced. People, for personal needs and obligation (and not business needs), were subjected to such exploitation which is in direct conflict to the virtues of Islam. Thus Quran declared it as a war against Allah and Prophet for those who are indulged in such exploitation. Still, in our feudal society, and even if you visit to Liyari and Fishrey, you will find such interest rates which exceeds 100%. This has made the life of poor peasants and fishermen a real hell, but you wont find any moulana sab coming up for their rescue.
As per well known econmic theories, Prices are the direct effect of supply and demand forces. IF Land is scarce, the price will shoot up. Example is the prices of properties in Tokyo and Newyork. Now match this against the price of Capital. There is abundance of Capital in Newyork and Tokyo and thus the interest rates are as low as ZERO to 2% in those top capitalistic countries. Now who can term this exploitation? In furtherance of my real needs and to increase my standard of living, if I seek capital for such a nominal interst rate, how can Allah declare a war on me? Does this looks logical?
I have more such good reasons which have made me to believe that our moulanas and scholars have a misunderstanding in fully appreciating the philosophy of the modern econmic system. But referring back to my first point, since they are all nearly unanimous, I am not indulging myself in interest.
I would like if anyone can correct me on those.
Wassalam.
Bilal.
Even though I have strong arguments against the existing theories declaring interest as it is as Riba and thus haram, still I am not indulged in interest based activities taking heed from the hadith which can be summarised as "If you have a doubt about something, leave it..." Excuse me as I am not able to recall it corectly and fully.. Would just like to add some dimensions to the discussion
Economics is actually the subject here, and not banking and acounting. If you refer any book of Economics, you will find FOUR factors of Production namely LAnd, Labour, Capital and Organisation. In order to produce an economic good, one or more of above factor is needed. Now each factor comes with a price. Land is paid Rent, LAbour is paid wages, Capital is paid interest and Organisation is paid Profit. People who wish to remove capital, a basic factor, are destroying the very foundation of economics. Thus, this utopian so called Islamic economic system wont work in the absence of capital.
Quran declares Riba as haram. In english we have two words (i) Interest (ii) Usury. I believe that its this Usury which is haram and not interest. Usury is that exorbitant rate of interest which defeats the purpose of national economic development and well being of society as a whole and is descriminatory and exploitory in nature. ISlam protects a poor and needy from exploitation. In the times of prophet Muhammad (saw), such interest was enforced. People, for personal needs and obligation (and not business needs), were subjected to such exploitation which is in direct conflict to the virtues of Islam. Thus Quran declared it as a war against Allah and Prophet for those who are indulged in such exploitation. Still, in our feudal society, and even if you visit to Liyari and Fishrey, you will find such interest rates which exceeds 100%. This has made the life of poor peasants and fishermen a real hell, but you wont find any moulana sab coming up for their rescue.
As per well known econmic theories, Prices are the direct effect of supply and demand forces. IF Land is scarce, the price will shoot up. Example is the prices of properties in Tokyo and Newyork. Now match this against the price of Capital. There is abundance of Capital in Newyork and Tokyo and thus the interest rates are as low as ZERO to 2% in those top capitalistic countries. Now who can term this exploitation? In furtherance of my real needs and to increase my standard of living, if I seek capital for such a nominal interst rate, how can Allah declare a war on me? Does this looks logical?
I have more such good reasons which have made me to believe that our moulanas and scholars have a misunderstanding in fully appreciating the philosophy of the modern econmic system. But referring back to my first point, since they are all nearly unanimous, I am not indulging myself in interest.
I would like if anyone can correct me on those.
Wassalam.
Bilal.
