Articles on Islamic Economics

Political Economy from Islamic Standpoint

Salman Ahmed Shaikh

Samuel Huntington in his book raised the debate of clash of civilizations and argued that Islam has ‘bloody borders’1. Let us look at the defence budget of major world economies. As per Stockholm International Peace Research Institute data for 2020, United States had spent $732 billion and China had spent $261 billion on defence2. Together, they spent close to $1 trillion on the military. How is this related to economics is not difficult to understand as development expenditure is compromised to spend on the military. As per the World Bank, there are 767 million people below the poverty line of $1.90 a day. It means that crude poverty gap is $531.9 billion (1.90 x 767,000,000 x 365) per year. The annual defence spending of the USA alone is more than what is required to pay $1.90 a day to each and every poor person in the world!

Samuel Huntington may classify democracy as an exclusive feature of western civilization. However, Islam, instead of discouraging democratic culture, instructed Muslims to instigate consultative decision making (Shura) as a recurrent process and guiding principle for collective decision making in their socio-political systems (Al- Shura: 38).

Instead of autocracy and exploitation, Islamic principles engender strong accountability (hisbah), limit the government’s power of levying exorbitant taxes and ensure socio-economic justice and civil equality. Islam directs Muslims to uphold justice and instructs that even enmity of a nation must not make them leave the path of justice (Al-Maida: 8). Injustice is one of the main hurdles in bringing about peace in this world. Injustice in politics, in economics and in every sphere of life must be avoided as per Islam.

On the other hand, Secularism as a philosophy or comprehensive doctrine is not entirely democratic if it does not allow religion to prevail in the public sphere of life even democratically. Islam permits individual freedom in the choice and practice of one’s religion or comprehensive doctrine. Some Muslim countries may not present the best examples of this commitment and they should correct themselves based on Islamic injunctions.

Secularism claims to be ‘neutral’ about religion, but in effect, it could turn out to be ‘insensitive’ to religion in several practical instances. Can we say there is a discrepancy between philosophy and practice? However, in the case of ideologies like Secularism, nothing is divine. Both its philosophy and practice is a result of human conception and attitudes. In its worst examples, the ‘public’ sphere of life can result in laws and policies which ban Hijab, beard, modest dress and in the case of a recent event, the ban of particular names for babies in some places in East Asia. ‘Private’ sphere of life then reduces to home alone. That is one’s private sphere since ancient times anyways.

Those who suggest that Muslims should blindly follow the Western countries for higher morals, they must note that some of the Western countries who claim to be secular deprive Muslims and people from other religions to practice their religion and uphold their values and cultural symbols.

For instance, European countries where there is full-scale or limited-scale ban on Hijab include France, Belgium, Latvia, Netherlands, Spain, Italy, Denmark and Germany. But, European countries where prostitution is legal include: Armenia, Austria, Belgium, Czech Republic, Denmark, Estonia, Germany, Greece, Hungary, Ireland, Italy, Latvia, Luxembourg, Monaco, Netherlands, Poland, Portugal, Slovakia and Switzerland.


  1. Huntington, S. P. (1993). “The Clash of Civilizations?”. Foreign Affairs, 22 – 49.
  1. SIPRI (2020). “Stockholm International Peace Research Institute Military Expenditure Database”.

11 replies »

  1. Dear Abichou,

    Some scholars favor democracy and some think that it is against Islam. In Islamic penal code, there are also a lot of complications and differences of opinion. My recommendation is to first settle the academic differences and come up with a broadly agreed upon Islamic viewpoint on some important contemporary matters. Only then, we can hope or expect applying the teachings in public sphere of life in any Muslim country. It is important to make people ready and aspire for these teachings. When the hearts change, the outer change will be visible. But, merely changing laws will not make up for deficiencies in the heart as well as in mind.


    • Dear Manoj,

      I think it is a very important question. I think the majority votes can decide disputes or differences. In an Islamic state, majority votes will not be used to settle religious matters. But, in terms of administration, planning or budget allocations, majority votes could be used to come up with decisions. Non-Muslims as per my understanding will be ‘Muahid’ i.e. they will be citizens with equal rights to vote in administrative matters. They can hold public offices, will not or should not be discriminated against and can practice their religion without any hindrance and the Islamic government shall make sure that their religious and civil rights are fully safeguarded.


  2. Thank you for your comment Mr. Abichou Najah

    In Democracy, rulers are elected by majority votes. In Shora, rulers are selected by qualification. Voting is different. The rulers are taking decisions by voting. When you seek an advice, you select a qualified person, you do not elect him.

    Your question: No one country respect all Islamic principles.

    If interested, you may read my book “Economic Systems: Human Thoughts vs. Sharia Law” at the following link:


    • Dear Maher

      Electing a ruler is in no way against Islam. In fact, it is more preferable and based on justice, freedom and human rights which Islamic teachings favor as well. In matters of public administration, consultative decision making is the most appropriate mechanism. Voting is one way to actualize it in recent times.


      • Dear Abichou;
        In democracy,
        • Election is a process of voting by populace. It reflects personal selection, mostly affected by the campaign of the candidate.
        • President appoints his friends, or members of his party, to be in the second level on the authority structure.

        The word “Shora” in Arabic is close to the meaning of seeking advice. My understanding to “Rule by Shora” in Islam is that:
        • The word “ruler” is said to include not only the president or king, but also any top leader who is given the authority of taking decisions in public issues, such as ministers.
        • A ruler may not take a decision before seeking the advice.
        • A ruler must follow the decision of the majority of advisors by voting.
        • Shora reflects selection based on qualifications. A ruler, as well as the advisors must be selected based on qualifications. Otherwise, they cannot participate in taking proper decisions.
        • In Shora, selection is a process of voting by the most qualified persons in a society. As an example, after the Prophet (Pbuh), Abo Bakr and Omar were selected to be rulers by what is called “Ahl Al Bay’a”. They are not all members of the society.

        Now, how Shora can be implemented in our complicated life.

        If a ruler needs to select a minister of health, he does not know who is the most qualified in this field in the society, but the union of doctors knows. The union represents the base of electorates for the minister of health. The members of the union shall select the most qualified doctors to represent them as the advisory committee in the congress with regards to the health issues. The members of the committee shall select the most qualified to be a minister.
        The members of the committees in all fields represent the congress. They shall select the most qualified prime minister.
        In Islamic countries, the top ruler needs exceptional qualifications that ensure that he will rule by justice according to Islamic Sharia’h. He will be selected in the same way by the union of religious men.

        Please note the following differences:
        • The members of the union have the authority to change their representatives in congress.
        • The members of the congress have the authority to change the rulers.
        • No election campaigns. No false election.
        • As the number of the members of the union increases, the chance to select the most updated qualified persons becomes higher.
        • The most qualified persons in the society rule the country.
        • Advice in every field is given and controlled by experts in the field.

        Under the name of democracy, 300 Million of US citizens are required to elect one out of two candidates for presidency. After election and according to the US constitution, US President is appointed by what is so called “Electoral College”. ????.

        Best regards
        Maher Kababji


  3. Democracy is completely different than the Islamic ruling system which is known as “SHORA”.
    In democracy, as you said, a country is ruled by, and for the interest of, elite class who is able to expand on political campaigns. In Shora, a country is ruled by most qualified persons (Neither appointed nor elected but invited) according to rules of God.


    • Jazak Allah Maher Kababji.

      Just one comment on your viewpoint. Election is not against Islamic principles. When we go for job, we may get hired by majority of people in the panel favoring our inclusion. Likewise, in annual general meeting, voting can be done to decide whether a company shall expand or increase salaries. However, yes, democracy can not be used to enforce a ruling that is against Islamic injunctions.


  4. A good effort. Please also mention the military expenses of muslim world as well for better understanding. I like the proof in fact and figures. May ALLAH give you strength to write more on the subject.


      • Dear Sahar

        It is ironic that western leaders claim today’s age as age of reason while only in first few years of 21st century, millions have died while billions of dollars have been spent on a war in Iraq that has brought nothing positive and which was instigated even when Collin Powell had admitted that there were no weapons of mass destruction in Iraq. It is clear double standard and denial of justice.


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