The ways of increasing the wealth are a separate issue from providing the needs, as it deals with generating the wealth and not with the human needs, so it differs from one country to another. In Muslim countries, it is approached and dealt with chiefly by finding ways in which to improve the agricultural products, to launch an industrial revolution, so that industry becomes the main method used in economic development and growth, ant to increase commercial productivity. This approach may be divided into four sections :
- The agricultural policy
- The industrial policy
- The financing of projects
- Creating an external market
The Agricultural Policy
This is based on increasing the yield and variety of farm produce, and usually follows two methods : a) finding means of increasing productivity of the land, and b) increasing the farming lands as a method of expansion.
These take place by using modern and sophisticated machinery, chemicals and by providing high quality seed. The State should provide grants (as opposed to loans) to the farmers who are unable to buy what they need in terms of machines, seed and chemicals, and it should also encourage those who are able, to buy such materials.
The expansion takes place by encouraging the revival of barren land and cultivating it. The State should grant feudal lands which are improperly used or left unused, to farmers who are able to work but have no land or little land, and from lands that are under its control. Anyone neglecting his land for three consecutive years would be forced to give it up to the State, which would allocate it to people who would make use of it. Imam Abu Yusuf narrated that : “Muhammad ibn Ishaque related to me that ‘Umar ibn al-Khattab said addressing the people on the pulpit : ‘Whoever receives a dead land, (it) would belong to him and whoever constructs a boundary wall, has no right over it after three years. This was because the people used to enclose land which they did not cultivate.’” (Kitab al-Kharaj).
By following these two methods, an increase in farm produce would be achieved, and the aim of the agricultural policy would be realised.
There are, however, issues to be considered while implementing such a policy. Once increased productivity is ensured, improving the quality of the produce has also to be considered. The policy of improving productivity has to be achieved by modernising the machinery; this necessitates the launching of an industrial revolution to match the ambitious agricultural programme, with industry providing the main means of progress.
Therefore, the agricultural policy should have three main aims in its bid to improve productivity:
- Improving food products, with the aim of satisfying the needs of the people, and to remove the spectre of famine in case of drought, failing crops or economic embargo. Efforts should be made to improve and increase productivity of food products in both agricultural and animal produce.
- Increasing productivity in clothing materials such as cotton, wool and silk, for these are basic necessities that should be made available without having to resort to imports and without creating a shortage in case of economic embargo.
- Improving the production of goods which would have a market abroad, whether they were textiles or food products, like citrus fruits, dates etc.
Development projects like the building of dams, canals, wells and others are to be given priority if they were indispensable, for the aim is not only to launch an agricultural revolution, but an industrial one, without neglecting the agricultural but always working towards increasing production; the aim also is to achieve material progress, and this cannot be realised without an industrial revolution.
The Muslim world is underdeveloped with an economy based solely upon agriculture and other natural resources, and there are scarcely any industries. Therefore, an immense effort is needed to put the industrial revolution into motion. The schemes of the colonial powers should be abandoned, for they aim at keeping the Islamic world relying solely on agriculture by encouraging such a policy and impeding its industrial progress to keep it dependent on the West, who provide most of the machinery and are the only source of maintenance.
It is worth mentioning here a basic economic principle in Islam that says, “Anything that reaps benefit to the Ummah should be provided for if funds were available, provided that it is not indispensable.” This means that if the State had funds available, then the project should be funded, but if the State did not have funds, it should not impose taxes upon the people in order to finance the project, nor borrow money for it, even from its own citizens.
The Industrial Policy
The main aim of the industrial policy is to make the country an industrial one. The direct route towards achieving such an aim is to first of all manufacture the machines; then other industries can be introduced. The priority would be given to build factories to manufacture machines. There is no other way to turn the country into an industrial force. Only then can industries which rely on the machines produced (i.e. manufactured) locally, be established.
To claim that the manufacturing of machines takes a long time and that we should begin by introducing the light industries, is baseless and a recipe for disaster; it is a plan schemed by the West to impede the main initiative of the Islamic world, and to keep it concentrating on consumer goods industries and as a market for Western industries.
It is also wrong to believe that this venture is unfeasible because it requires industrial personnel which are not available. Firstly, Muslim countries have a large surplus of trained and qualified personnel who have no jobs due to unavailability of technology and industry in their own countries. These people would be used by the Islamic State for participation in the industrialisation process. Additionally, industrialised countries have a surplus of industrialists, engineers and technicians who can be contracted while the Muslim youth are trained to acquire such knowledge.
Therefore, efforts should not be wasted in light and consumer industries while the drive towards achieving the industrial revolution is still under way. Thus, the first step would be to manufacture the machines. This policy should be pursued simultaneously and not stage by stage. We should not wait until we reach one stage before we start another; because these obstacles that would delay our progress are imaginary.
What the Muslims possess nowadays in terms of consumer industries should be maintained as they are, without attempting to expand, but rather the concentration should be upon launching the industrial revolution. The import policy can remain in force according to the Islamic economic policy, until such machines are locally manufactured. Even the state industries like mining would have to follow the same strategy. The State, being the only legal owner of such industries under Islamic law (such as oil, minerals and other natural resources) would not buy machines to extract minerals, for this would divert its efforts from manufacturing such machines and thus impede the industrial revolution.
The State would rather buy the raw materials and maintain the existing factories and plants until such time as the machines can be locally manufactured. The huge profits from such resources of the Muslim Ummah, instead of being usurped by the Western nations and the corrupt rulers of Muslim countries, would be diverted towards providing the basic needs of the people and funding the industries.
Financing the Projects
The economic policy in Islam has undoubtedly determined the projects which the State should adopt, and those which the individuals should adopt. The agricultural policy falls into the private sector, and there is no place for the public sector in this area, except in offering farmers grants and financing building projects and developments, like dams, canals and channels.
The industrial policy is open to the private sector as well, except where the industries are linked to resources that fall under the public ownership, like oils, basic minerals etc. Such industries must fall under the public (i.e. state run) sector. Naturally, these projects, whether public or private, require financing.
As far as the private sector is concerned, it is up to the individual, the company or the partners to finance their projects in any way they deem fit by legal means (i.e. by what the Shari‘ah permits).
As for the public sector, it should not resort to overseas loans to finance its projects, for this leads to increasing foreign influence, and also to increasing poverty, which is the result currently seen in Third World countries, whose economies are crippled by such loans. Besides, such loans are generally subject to interest, which is forbidden in Islam. Therefore, the State should finance its own projects even by imposing taxes upon those who can afford it, in order to raise sufficient funds to launch the industrial revolution. The Islamic verdict on taxation projects should apply if such measures were to be taken, such that poor people would not be subject to the taxation.
Projects could also be financed by purchasing machinery on easy terms, even if it means paying more for the machines in the long term than their actual prices; this should be on a sales basis, and not on a usury transaction.
Establishing the Foreign Markets
Marketing goods is one of the major factors that generate wealth. Many countries have taken great care, past and present in finding markets for their goods and products. Many economic empires have been established on such a basis. It is essential therefore for the Islamic State to market its goods and products. However, this should not be an aim but a means to helping the purchase of goods necessary for the industrial revolution, to acquire hard currency or to send the Muslim youth to acquire the necessary education such as civil engineering, medicine etc.
On this basis, the policy of establishing foreign markets should be pursued, i.e. on a commercial and industrial basis. Attention should not be focused on the trade balance with the different countries. It is insignificant for our exports to be less, more or equal to our imports, as long as the objectives of the Economic System, the foreign policy and other obligatory considerations of the State are achieved, by being commercial and industrial at the same time, whether the trade balance were to our advantage or not. However, it should be noted that the basis followed by the Islamic State in its trading is different from any other in the world. All other countries deal on the basis of where the goods originate from and not where the businessman comes from. The State bases its trading on the traders origin, not on the origin of the manufactured or produced goods. This should be taken into consideration while establishing trading relations. In this way, the Islamic State will not for example, be involved in any trade with countries who are hostile to it, or at war with it.The businessmen of the State are its citizens, and they deal with others on the basis of free trade on goods that are legal according to the Shari‘ah; whereas other businessmen trade according to the foreign policy of their country.
This method of trading, if pursued, would help generate and increase the wealth.
In these ways, the economic policy of the Islamic State will build it up as a powerful economic force, where it will supply the basic needs of its people, and enable them to fulfil their luxurious needs as much as possible, while undermining all the corruption, inequality and unfairness that is manifest in the Western and Socialist economic systems.