Since the development of man’s earthly life, business in the form of exchanging or bartering essential commodities has been an integral aspect of the daily lives of human beings. The basic 
essential needs of man are food, drink, clothing and shelter. These primary needs, which are crucial to man’s survival on earth as well as to the improvement of his living conditions, are only obtainable through the institution of business and trade.
It is virtually impossible for one person to satisfy all these needs alone by producing them or manufacturing them himself. Man is, therefore, forced to purchase these items of need from the various individuals or companies who produce them, and this results in the practice of buying and selling on a very expansive scale. Islam has, therefore, attached great importance to trade and commerce, as the relevant citations appearing further on shall conclusively indicate.
Islam is an entire way of life, and Allah’s guidance extends into the every scope in our life including in the business activity. These regulations of economic in Islam are balance and fair. As we are only the trustee of God, these principles are aiming to establish a just society wherein everyone will behave responsibly and honestly, to counter man’s greed and consequent abuse of the rights of others; to ensure that the earnings of man are halal and pure; to create a harmonious atmosphere among people, something which can be utterly destroyed by man’s desire for wealth and position.
The fundamental principles of the Islamic economic system are as what we will discusses further in this article. Islam has permitted and in fact encouraged Muslims to do business. The Quran states:
“Allah has made business lawful for you” [2:275]
Islam has given detail laws of business. Islam has not permitted selling and purchasing of goods, which are prohibited in Islamic law. Prophet has said:
“When Allah prohibits a thing, He prohibits (giving and receiving) the price of its as well” [Ahmad and Abu Daud]
Islam has also prohibited any kind of transaction that falls under the category of uncertainty (garar) as this could lead to quarrel or litigation. This includes the uncertainty involving the unspecified quantity like acceptance of money for fish in the ocean or bird in the air. However if the element of uncertainty is very small, then it is permissible.
Freedom of trade and operation of market forces are allowed in subject to the limit set by the Shari’ah. However, it is unlawful to hoard food and other basic necessities for the sake to make high profit at the cost of public interest. Allah said in His Holy Book:
“And let those who covetously withhold of the gift which Allah has given them of His Grace, think it is good for them. No, it will be the worse for them. Soon it will tied to their necks like a twisted collar, on the Day of Judgment. To Allah belongs the heritage of the heavens and the earth, and Allah is well-acquainted with all that you do” [3:180]
Islamic law has prescribed measures to prevent manipulation of market, exploitation of seller or buyer and fraud. Prophet prohibited people from going out of town to buy merchandise, which was on its way to city market. The reason for this is that the market place is where the forces of demand and supply determine prices, which is the best place for trading transactions. So, if the situation of buying occurred on the way to market, the seller may not know the exact price and he may be deprived of legitimate price.
It is forbidden to gain property or wealth by fraud, deceit others, theft or other falsehood. The sin of fraud is greater if the seller supports it by swearing falsely. Prophet said:
“Swearing produces ready sales but blots out blessing” [Bukhari]
“Sell the good and bad separately. He who deceives is not of us” [Muslim Ahmad]
In the same manner deceiving others by withholding full measure is also prohibited. Allah placed great emphasized on this by saying:
“And give full measure and (full) weight in justice” [6:152]
Islam has prohibited business transactions on interest. Muslims are not to deal in interest. This prohibition is for all interest-based transactions, whether giving or receiving, whether dealing with Muslims or non-Muslims. It is reported that Prophet Muhammad cursed those who pay interest, those who receive it, those who write a contract based on it, and those who witness such a contract. Allah said in His Holy Book:
“Allah has permitted for you trade and prohibited interest” [2:275]
In conclusion, Islam has permitted and encouraged business subject to aforementioned principles and restrictions. If all of these principles are followed, the economy of Muslims world will be greatly purified from harmful practices and it may expand.
essential needs of man are food, drink, clothing and shelter. These primary needs, which are crucial to man’s survival on earth as well as to the improvement of his living conditions, are only obtainable through the institution of business and trade.It is virtually impossible for one person to satisfy all these needs alone by producing them or manufacturing them himself. Man is, therefore, forced to purchase these items of need from the various individuals or companies who produce them, and this results in the practice of buying and selling on a very expansive scale. Islam has, therefore, attached great importance to trade and commerce, as the relevant citations appearing further on shall conclusively indicate.
Islam is an entire way of life, and Allah’s guidance extends into the every scope in our life including in the business activity. These regulations of economic in Islam are balance and fair. As we are only the trustee of God, these principles are aiming to establish a just society wherein everyone will behave responsibly and honestly, to counter man’s greed and consequent abuse of the rights of others; to ensure that the earnings of man are halal and pure; to create a harmonious atmosphere among people, something which can be utterly destroyed by man’s desire for wealth and position.
The fundamental principles of the Islamic economic system are as what we will discusses further in this article. Islam has permitted and in fact encouraged Muslims to do business. The Quran states:
“Allah has made business lawful for you” [2:275]
Islam has given detail laws of business. Islam has not permitted selling and purchasing of goods, which are prohibited in Islamic law. Prophet has said:
“When Allah prohibits a thing, He prohibits (giving and receiving) the price of its as well” [Ahmad and Abu Daud]
Islam has also prohibited any kind of transaction that falls under the category of uncertainty (garar) as this could lead to quarrel or litigation. This includes the uncertainty involving the unspecified quantity like acceptance of money for fish in the ocean or bird in the air. However if the element of uncertainty is very small, then it is permissible.
Freedom of trade and operation of market forces are allowed in subject to the limit set by the Shari’ah. However, it is unlawful to hoard food and other basic necessities for the sake to make high profit at the cost of public interest. Allah said in His Holy Book:
“And let those who covetously withhold of the gift which Allah has given them of His Grace, think it is good for them. No, it will be the worse for them. Soon it will tied to their necks like a twisted collar, on the Day of Judgment. To Allah belongs the heritage of the heavens and the earth, and Allah is well-acquainted with all that you do” [3:180]
Islamic law has prescribed measures to prevent manipulation of market, exploitation of seller or buyer and fraud. Prophet prohibited people from going out of town to buy merchandise, which was on its way to city market. The reason for this is that the market place is where the forces of demand and supply determine prices, which is the best place for trading transactions. So, if the situation of buying occurred on the way to market, the seller may not know the exact price and he may be deprived of legitimate price.
It is forbidden to gain property or wealth by fraud, deceit others, theft or other falsehood. The sin of fraud is greater if the seller supports it by swearing falsely. Prophet said:
“Swearing produces ready sales but blots out blessing” [Bukhari]
“Sell the good and bad separately. He who deceives is not of us” [Muslim Ahmad]
In the same manner deceiving others by withholding full measure is also prohibited. Allah placed great emphasized on this by saying:
“And give full measure and (full) weight in justice” [6:152]
Islam has prohibited business transactions on interest. Muslims are not to deal in interest. This prohibition is for all interest-based transactions, whether giving or receiving, whether dealing with Muslims or non-Muslims. It is reported that Prophet Muhammad cursed those who pay interest, those who receive it, those who write a contract based on it, and those who witness such a contract. Allah said in His Holy Book:
“Allah has permitted for you trade and prohibited interest” [2:275]
In conclusion, Islam has permitted and encouraged business subject to aforementioned principles and restrictions. If all of these principles are followed, the economy of Muslims world will be greatly purified from harmful practices and it may expand.
