Byline: Amna Khan
Pakistan emerged with the objective to prosper as an Islamic nation by following divine code of guidance from Allah and his Prophet Muhammad (PBUH) in Quran and Sunnah. However, in the beginning of materialization the domino effect of society's Islamic conviction were merely appreciated in their culture, rituals and way of living but little or no influence of society celestial beliefs are evidence in commerce and financial sectors of the country. Nowadays, our banking and financial systems are gradually moving towards Islamic procedures from conventional one. For instance large portion of our financial sector comprises of Islamic banks and institutions. While the commerSce slice of our economy stagnantly adhere the commercial laws constructed by state government, benchmarking Western laws of business, which subtle the impact of Shariah rule.
Thus, this results in formation of businesses which associated with decisions, products, dealings, contracts and practices that are makruh or prohibited (haram) from slamic perspective.
Islam is the unique and divine religion that comprehensively covers all aspects of Muslims life, explicitly it don't solely emphasize or regulates Muslims religious commitment and routine life though, it equally plays an overarching role in systematizing commercial, commerce and business dealing by dint of Shariah laws (traditional Islamic commercial laws), which directly deriving from delivered revelation Quran, which enclosed the actual words of almighty Allah and not recited revelation hadith the words and teaching of Prophet Muhammad (PBUH) which later interpreted and explain by Muslim scholars.
Islamic laws which are enshrined in Quran and Sunnah put a noticeable emphasis on the principles of justice, objectivity, equality and neutrality. In the business sphere these doctrines convert in the prevention of interest (riba or usury) and also compel business to be cautious of involving in speculative or risky investments, transactions or contract which devise extreme uncertainty (gharar), gambling (maysir), weapon business, prostitution, sell products of non-halal components like alcohol or pork, involvement in an ambiguous contract that are in Allah's hand like insurance policies.
Countless verses stated in Quran and Sunnah underline the Islamic approach of business transactions, contract formations and Shariah decisions.
Islamic law has strictly forbidden businesses to deal in terms of usury or riba (interest). As Allah said in Quran,
"Those who take interest cannot stand [In their dealing with people] except like the one who has been confounded by the touch of the Satan-this is so because they say, that trade is just like interest. [Whereas] Allah has allowed trade and forbidden interest."(Surah 2:275). Shariah laws always support the wellbeing of all parties involved. Hence, Islam do not tolerate usury in any sort of business transactions because the almighty Allah has permitted business or trade which embrace definite degree of risk and strictly prohibited to involve in any nature of investments that guarantees fixed returns for one party but not for the other. The core objective behind prohibition (haram) of charging usury is that it is considered as taking undue advantage of parties in poor state of bargaining, provoke...