Conclusion. up to the modern times has been studied focusing on the outstanding contemporary

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2 Conclusion In the foregoing chapters development of Islamic economic thought in medieval period up to the modern times has been studied focusing on the outstanding contemporary economist, Dr. Muhammad NejatullahSiddiqi s contribution. Islamic economics as a matter of fact has been the subject of discussion among the Muslim scholars right from the Prophet s period. Early analysis of economic matters was, however, made by them in the disciplines of tafsir, hadith and fiqh. This was followed by abundance of literature that was produced on the subject. The economic responsibilities of a ruler, payment of zakat, disbursement of public funds, exploration, utilization and development of natural resources and works of public utilities are some of the major themes upon which the early Muslim scholars, such as Imam Abu Yusuf, Abu Ubayd, Yahya bin Adam, Qudamah binja far and Mawardifocused their discussions. This was followed by special treatment to the other economic aspects such as buy and sale prohibition of interest, lending of money, production and distribution, supply and demand, development of various types of crafts, capital formation, trade cycles and international trade. Some of the eminent Muslim scholars who made analytical study of these economic issues were Imam Ghazzali, IbnKhaldun, IbnTaimiyyah and Shah WaliullahDehlwi. This has been specifically discussed in first portion of the present work.the second part which is our main concern is related to the modern development of Islamic economic thought. It is the development which took place in the back drop of the Western theories and systems of economy.the subject gained extra ordinary momentum in the twentieth century when a number of Muslim scholars came forward and produced abundant literature, in it they attempted to project Islamic economics as a viable alternative to Capitalism and Socialism on the basis of the logical and realistic solutions that Islam provides to the economic problems of man. On one hand economic principles of Islam were thoroughly analyzed and discussed by Muslim scholars in the 160

3 light of Qur an, Hadith and the vast intellectual heritage left by their predecessors. On the other hand, the prevailing economic systems; capitalism and socialism were critically evaluated. Muhammad NejatullahSiddiqi an Indian living economist of present times, trained both in modern education and Islamic learning figures prominent in developing the Islamic economic thought in new times along with the other Muslim economists. His contribution to the field is immense and it has been much valued both in academic and common circles of Muslims. His treatment of the subject is found in a number of works and articles published during the last four decades. Besides he has been associated with several Islamic economic groups and institutes in India and abroad. This led him to produce Islamic economic thought of distinctive nature in which many contemporary issues have been discussed in a good deal. Dr. Siddiqi s main argument is that an Islamic economy is capable of freeing modern man from debt-ridden economy in which he lives and of guiding him towards a society based on justice and equity. He also demonstrates that such an economy would also ensure growth and stability. Dr. Siddiqi has sought to respond to the many challenges that the modern economic system poses for Muslims. He holds the view that economic activity and economic ends are conceived as means to this life end. The economic sub ends must be consistent with the ultimate ends. The economic policies should aim at furthering the all sided welfare denoted by the Qur anic conception of falah. According to him the modern Islamic economy will be modern, utilizing the best techniques of production and methods of organization available. To him it is imperative for the reconstruction of the economic system on the Islamic pattern, an interest-free banking system should be established and run successfully. The reorganization of banking on the Islamic pattern can be brought about on the Islamic principles of mudarabah and shirkah. For this purpose he has made an effort to present the outline of interest-free 161

4 banking on Islamic lines which became instrumental in exploring the Islamic system among the academic and intellectual circles across the world. Dr. Siddiqi also discussed the problem of insurance in an Islamic framework. He has taken somewhat different position from the one traditionally taken by the ulama in the Indo-Pak subcontinent. He has argued that insurance and gambling are basically different from each other and that Islam is not inherently opposed to the idea of covering calculable risks. A new model of insurance against certain risks to persons or property can, therefore, be developed. Dr. Siddiqi advances some preliminary suggestions towards this end. The role of the state in an Islamic economy has also been examined by him in his various works and its theoretical framework is explored well. Its main aim is guaranteeing a minimum level of living to all inhabitants of it. Besides the question of public borrowing in early Islamic history is also discussed and it is maintained that this practice is not a novel one but an old phenomenon. The crucial role of public expenditure in invigorating growth in an Islamic state has been elaborated by Dr. NejatullahSiddiqi which emphasizes development in Islam. He draws upon the injunctions of the Qur an, the Sunnahand the practice of the four rightly guided khulafa to outline the first category of duty of the Islamic state i.e. fulfillment of basic needs of society such as defense, law and order, da wah, alamrbilma rufwanahianilmunkar (inviting people to do good deeds and avoid evil), civil administration and fulfillment of social obligations that the private sector fails to fulfill. Siddiqi resorts to the second category based on ijtihadof our scholars. This includes any expenditure necessary under present circumstances such as protection of environment, supply of necessary public goods other than those listed earlier, scientific research, capital formation, subsidies for certain essential private activities and expenditures necessary for stabilization purposes. He cites a third category of expenditures based on the process of shura (consultation). An efficient fiscal 162

5 distribution system is described as means to avoid israf (extravagance), minimize free rider problem where people depend on welfare handouts, maximize growth potential with an incentive to save. An Islamic view on transactions, in general, while introducing Islamic terminology on prohibited practices like usury, gambling, etc is found in his works and, at the same time comprehensive explanation of theories of international trade and commercial policy is given. Concepts on balance of payments, exchange rate (fixed and flexible regimes) and mobility of capital from an Isl amic perspective are also explained. The distinguished trait of Dr. Siddiqi s thought is that there is hardly any impact of the Western economic thought on him. He seems to be directly inspired by the Qur an and the Sunnah and amplified by his wide erudition and experience. By responding to the modern developments of conventional economic thought and anticipating the challenges of the new age, Dr. Siddiqi sendeavour serves as a bridge between medieval and modern developments in Islamic economic thought. An exhaustive study of him reveals that he is a theorist who is more concerned about the conceptual part of Islamic economics of his times. Unlike some other Muslim economists he does not seem involved in practical field of economy and finance of Muslim societies or countries though indirectly this is implied in his writings. Yet his work is developing basic structure of Islamic economy, interest free banking, public finance, insurance, economic role of state, economics of international relation etc. made a distinctive development in the contemporary Islamic economic thought. It explored the special dimensions of the subject in more broad based way integrating many conventional views within comprehensive outlook of Islam and his whole paradigm highlights the Shari ah principles of public interest (maslahah). 163