Khurshid Ahmad

Prof. Khurshid Ahmad highlights that for Muslim majority countries; the challenge of economic development is to pursue the goal of achieving meaningful human-centric economic development that is consistent with Islamic principles and which fosters the use of policy instruments and design of Islamic economics. He acknowledges that Muslim countries grapple with widespread economic underdevelopment, characterized by the underutilization of human and physical resources, resulting in poverty, stagnation, and backwardness.

On the dilemma of whether to pursue economic development by emulating Western industrialized countries or to undertake a unique socio-economic reconstruction rooted in Islamic principles, Prof. Khurshid Ahmad argues that it is important to discern the essence of economic development within an Islamic framework rather than just playing catching up. The Western experience of economic development has not been able to address the growing inequalities. Prof. Khurshid Ahmad argues that the trickle-down effect is a conjecture not proven by empirical evidence.  

Prof. Khurshid Ahmad identifies the path to follow in order to achieve this objective. The first step is to identify the Islamic ideal of economic development and then assessing the gap between this ideal and the current state of the Muslim world. Then, the next step is to devise strategies to foster development within an Islamic framework. 

Prof. Khurshid Ahmad laments the fact that development planning exists in many Muslim countries, yet it often mirrors Western growth prototypes, neglecting to integrate Islamic ideals and values into development strategies.  According to him, this has led to developmental policies that are more or less Islam-neutral, failing to transform the economics of the Muslim world towards Islamic principles and often exacerbating existing inequalities. 

Prof. Khurshid Ahmad argues that the Western model of development overemphasized industrialization, capital formation, and technological transfer while neglecting social and cultural factors. This approach adopted as it is by the third world countries has led to negative consequences, including increased poverty, inequality, and dependence on foreign aid. He argues that Western development model promotes individualism, and materialism, which conflict with Islamic values. It also leads to social divisions, wasteful consumption, and moral decay.

Prof. Khurshid Ahmad emphasizes that the Islamic concept of development focuses on human development across moral, spiritual, and material dimensions.  It encompasses the purification and growth of individuals and societies, striving for comprehensive well-being and prosperity in this world and the hereafter. He lists the goals of development policy within an Islamic framework which include human resource development, expansion of useful production, improvement in the quality of life, balanced development, evolution of new technology, and reduction of national dependency on the outside world.   

To achieve these objectives, Prof. Khurshid Ahmad argues that it is imperative to move away from simplified aggregate growth models and adopt a multi-objective approach that addresses specific problem areas.  This entails a more active role for governments and the establishment of new social institutions, alongside the encouragement of small and medium-scale private enterprises.  Furthermore, it necessitates a renewed focus on research and planning to devise creative solutions and develop more realistic plans for the future.   

Prof. Khurshid Ahmad highlights that Islamic concept of development will give due importance to social justice. Growth for the sake of growth is not ideal as there are limits to growth. Inequitable growth that does not result in employment creation and need fulfilment of all is not ideal. He thinks that humans should be put first.

Prof. Khurshid Ahmad emphasizes the role of Maslaha based production through existence of public sector in determining the product mix and pricing in socially important sectors. This can help in plugging the gap of unmet needs which is left vacant by profit maximizing firms in the market economy. Thus, the author cautions against joining the polar extremes of Western economic systems. Instead, the realities and the context of Muslim world shall be studied and development policy shall be home-grown, rooted in Islamic vision, flexible enough for adaptation, multi-dimensional and human-centric.

Prof. Khurshid Ahmad argues that Islam emphasizes integrated human development, encompassing moral, spiritual, and material dimensions. The author outlines the philosophical foundations of Islamic development, including:

• Tawhid (Oneness of God)
• Rububiyyah (Divine sustenance)
• Khilafah (Vicegerency of human)
• Tazkiyah (Purification leading to growth)

Prof. Khurshid Ahmad outlines the goals of economic development which include human resource development, expansion of useful production, and ensuring equitable distribution of income and wealth. In the process of development, he emphasizes the importance of moral orientation, cooperation, and social responsibility.

In development policy in Muslim majority countries, Prof. Khurshid Ahmad suggests that there is a need for greater cooperation and integration among Muslim countries to achieve economic development. He advocates for a shift away from aid-based development towards self-reliance. The author critiques the negative impacts of foreign aid, arguing that it has not produced the desired results and has led to dependence and indebtedness. Prof. Khurshid Ahmad argues that debt-based development strategy has led to increasing indebtedness for many Third World countries, with a net transfer of resources from the poor to the rich. He also argues that depreciation of petrodollars in exchange of oil is not fruitful in the long run. The real natural resource goes out and the payment in fiat currency also remains parked in off-shore accounts and faces depreciation. It also hinders self-reliance, independence and diversification of investment, production and employment in other sectors. He maintains that globalization shall not become a “rubric of neo-colonialism”. 

Prof. Khurshid Ahmad clarifies that self-reliance does not mean that we should cut ourselves from the rest of the world as in autarky. Instead of trying to be self-sufficient in everything, he favours self-reliance which implies having enough space to develop home-grown and context-specific policies which make use of Islamic economic teachings, institutions and operating principles.