Book reference: p.132 — "Explain the basic principles of the Economic System of Islam."

Core Principles

• Ownership belongs ultimately to Allah
  • Man holds wealth as a trustee (Khalifah), not an absolute owner (2:284).
• Permission of private property
  • Within ethical/legal limits — unlike pure communism.
• Prohibition of Riba (interest)
  • 2:275, 2:278-279.
• Prohibition of Gharar (excessive uncertainty/speculation) and Maysir (gambling)
  • 5:90.
• Obligatory Zakah
  • Systematic wealth redistribution (see Theme I).
• Halal earning and prohibition of exploitation
  • Fraud, hoarding (Ihtikar), and short-changing in trade (83:1-3) are explicitly condemned.
• Balance between individual enterprise and collective welfare
  • Unlike pure capitalism (unchecked accumulation) or pure socialism (abolition of private property).

Qur'anic Evidence

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وَيَلٌ لِّلْمُطَفِّفِينَ

اردو: تباہی ہے ڈنڈی مارنے والوں کے لیے (جو ناپ تولتے ہیں)۔

English: "Woe to those who give less [than due], who, when they take a measure from people, take in full, but if they give by measure or by weight to them, they cause loss."

— Surah Al-Mutaffifin 83:1-3

لِلَّهِ مَا فِي السَّمَاوَاتِ وَمَا فِي الْأَرْضِ

اردو: آسمانوں اور زمین میں جو کچھ ہے سب اللہ ہی کا ہے۔

English: "To Allah belongs whatever is in the heavens and whatever is on the earth."

— Surah Al-Baqarah 2:284

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CSS Exam Tips

• Explain the basic principles of the Economic System of Islam.
• Compare briefly with capitalism and socialism for a strong concluding contrast.
• Cross-reference: Islamic Financial and Economic System, Economic System of Islam in the Light of Social Justice.

20-Mark Enrichment — Analytical Material

Core Argument

The Islamic economic system rests on a small number of first principles from which every rule follows. The 20-mark thesis: state the principles as a numbered architecture — divine ownership and human trusteeship; lawful private property with a right of the poor within it; freedom of enterprise bounded by prohibition; risk-sharing instead of guaranteed return; compulsory circulation; moderation in consumption; moral accountability of the economic actor; and state responsibility for market fairness and subsistence — and then show that the familiar rules (ribā prohibition, Zakāt, inheritance, ḥisbah) are derivations, not a list.

1. Principle One — Divine Ownership, Human Trusteeship (Istikhlāf)