Poverty Alleviation: An Aim Of Islamic Economics

Poverty is treated as WMD (weapon of mass destruction) of modern world. Eradication of it bears very importance. The economic systems like capitalism and communism have presented number of instruments for the alleviation of the poverty from the world. But, these extreme ideologies failed to satisfy the need of the people. Private ownership of property, laissez-faire policy of capitalism and class war, dialectical materialism, state ownership of property of communism didn't touch the real cause of poverty. This situation necessitates seeking the possibilities of Islamic economics in alleviating poverty. The aim of poverty alleviation can be attained, in an Islamic Economic system through reducing the inequality. It never means attaining equality but equity and justice in the income and wealth distribution. Islam eliminates the absolute inequality which arises from unequal distribution of income, but relative inequality emerges from equitable distribution of income and wealth.

First part of this article has given a small introduction to both conventional economics and Islamic economics. Then it provides a picture of poverty of current world and Islamic perspective of poverty. Then Islamic economics instruments to alleviate poverty such as zakat, sadaqa, qard hasan, ganima, khums, fay, jizya, mudaraba, musharaka, prohibition of interest, abolition of extravaganza, prohibition of speculation and hoarding have been mentioned in briefly. Influence of Islamic economic instruments on marginal propensity to consume, multiplier, price investment and production have been dealt with.

The books and articles I referred for this article are Dr. Dr.Sabahuddin Azmi's Islamic Economics, S. M. Hasanuzzaman's Economic function of an Islamic state (The early experience), Towards understanding the economic system of Islam written by Dr.P Ibrahim and Introduction to the economic system by Moulavi.M.V.Saleem.

Introduction

Nobody can undermine the importance of economics which is a social science that studies the production, distribution, trade and consumption of goods and services. This very importance of economics resulted in emergence of different economic systems in the world and all of those economic systems claim that they will fetch economic welfare. Those dominating and prominent economic system's failure to accomplish economic justice, prosperity, the eradiation of the inequality and poverty make necessary an alternative economic system which can successfully make a starvation free and poverty free world.

Definition of Economics

Social scientists have developed various definitions of economics. Lionel Robinson's scarcity definition of economics is most accepted amongst them. According to Robinson "economics is a science which studies human behavior as a relationship between ends and scarce means which have alternative uses" This definition is based on two points which are scarcity of resources and the never ending needs. But in reality former is a myth. The survey conducted by UNO shows that are enough resources for 20000 million people on earth we have only 6000 million people on earth residing now. Latter point 'never ending needs' is also incorrect as the desire and greed of the man is unlimited but the need is countable and controllable.

Definition of Islamic Economics

As a system of life Islam has not left any area of human life without guidance. Whether it is spiritual, individual, social, economical or political Islam gives clear cut guidelines. By considering the economic guidelines of Islamic sources, Islamic economists have developed plethora of definitions. Derivation of each definition of Islamic economics is based on guidance given in the basic sources of Islamic shariah which are Quran and hadith.

According to Yusuf Ibrahim, professor of Islamic economics, Qatar University "Islamic economics is a science studying the guidance of the human behavior towards the use of resources to satisfy the needs". This definition is based upon the following facts.

1. The resources are enough for satisfying the needs.

2. But the resources should be protected from the waste, and improper use.

3. The human behavior towards the resources should be controlled by divine injunctions.

4. Only legal needs, needs that build life on the earth, should be satisfied.

5. Illegal needs (desires), which destroy life on earth, should not be satisfied; they are never ending and never satisfied.

Islamic economic system, a normative economic system, has been built upon certain fundamental Islamic philosophies. According to Quranic teachings real and absolute ownership of the wealth belongs to the creator of the same, Almighty God. Quran says "To Allah belongs to everything in the sky and on the earth" (2:284).Role of the man is considered as trustee who is to manage the trust, i.e. wealth according to the directives of the real owner; God. Quran clearly states "And spend of that where of hath made you trustees" (57:7). So man has been granted

conditioned and limited ownership.

Another Islamic philosophy is universal brotherhood and equality of men as their creator is one and parents are same. Hence distinction based on color, caste, creed, races do not suffer at any cost. This concept induces the people for cooperation and participation in their all efforts instead of cheating, exploiting and making fraud each other. Another aspect of Islamic philosophy is the faith in the Day of Judgment after death. In the life after death man is accountable for his deeds on earth. The implication of this faith is that economic choices one makes in world are to be judged according to the norms Allah has laid down.

These are the revolutionary points which differentiate Islamic economics from the liberal, capitalistic, imperialistic, mainstream, usurious economic system and communist, class war, state dictatorship economic system. Islam constructs a just world on the spirit of everlasting divine concepts.
Poverty

Evil of any economy is poverty. The presence of begging hands in an economy pulls that economy into decades back. Poverty midst plenty is the challenge faced in the modern world. Impact of the poverty cannot confine into starvation only, but poor people, apart from starvation, suffering limited income which leads to inaccessibility of good education it disables them for challenging careers which requires number of years long education. Absence of nutritious food results in more child morality among deprived sections. Since limited access for information and knowledge those are prevented from market and opportunities.

Every country and international organizations like World Trade Organization, World Bank and Asian Development Bank hard work to construct the countries and world on the foots of self sufficiency respectively. Mission of the World Bank is described as global poverty reduction and improvement of living standards. General Council of UN has declared October 17 as International day for the eradication of poverty. It shows how seriously they took poverty as a problem

But, it is wondering that out of 6.1 billion world population more than 1 billion are finding their livelihood in less than $1 per day and almost 3 billion on less than $2 per day. You might be provoked that 74% of total income of world is shared by the 20% of the elite class of the world. It is heartening you that there are countries whose national income is less $800 and morality of below five years age children is about 26%.It is worrying that 110 million primary school age children are out of school and 60 percent of them are girls.
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Poverty and Islamic Economics

Below Poverty Line (BPL) fixes in Islamic economics system on the basis of ownership of nisab, which limit makes one eligible for the payment of zakat Whosoever wealth on or over the nisab is responsible for the payment of zakat. Those wealth is below nisab are zakat recipients and they are treated as poor. Hence, in Islamic economics, the size of deprived come under BPL will be large. Starvation and inaccessibility of food, shelter, cloths and education could not suffer in an Islamic economy which aims human falah, i.e. human welfare. It does not support any economic instrument that leads to the deprivation of the man. Since poverty emerges in an economy as a result of various causes so wiping out of these causes is primarily important.

Limited income, unequal distribution of income and wealth, misdistribution of resources, regional disparities, unemployment, social injustice, and decreased investments ...etc are some of the obstacles in the way of attainment of self-sufficiency and welfare. Islam considers the fulfillment of basic needs of every member of society is economic, moral as well as religious obligation of the ruler. List of the basic goods extends from traditional food, clothing and shelter to seasonal clothing, personal attendant to disabled person, and expenditure on marriage of poor and expenditure on entire family of poor, which are intensified by scholars from time to time and likely to extend the list time to time for the welfare of the citizen. Islamic economic system introduces a bunch of divinely guided instruments which bring to an end of poverty and build
poverty less world.

Islamic Economic Instruments to eliminate poverty

It is advised to Muslim citizens in an Islamic county, as the part of believe, to practice certain things in their life, some of them are compulsory nature and the rest are voluntary nature. The practice of these will have vast economic implications apart from the reward of God. Non Muslim citizens also have to make certain compulsory payments, which have economic impacts, as the part of their citizenship in the Islamic country. Compulsory duties and agreements of citizens are governed by the Islamic country and violation of any part would not suffer Islamic state. In addition to these functions there are other things the Islamic state has to carry out similar to any nation does for the welfare of citizens. Both positive and negative measures have recommended by Islam for wiping out the reason of poverty.

Positive Measures

There are numerous Islamic orders and injunction to perform certain things which have immense influence on economies justice, prosperity and growth. Important divine injunctions amongst them and their influence upon the economy are briefed below.

Zakat

Zakat is the yearly obligation of wealthy Muslims to poor and it is the share of have-nots in the property and wealth of the rich. Quran commends "establish worship and pay the poor his due (zakat) and obey the messenger". Technically we can call it as spiritual tax. It is imposed on those forms of wealth which have the capacity to grow in value or otherwise produce further, is having the custody of whole year and have exceed a certain minimum value called 'nisab'. Quran has stated the eight specific heads for the distribution of zakat.
Due to the divine spirit for the performance of zakat, chances for evasion are less. The imposition of zakat on idle wealth urges the owners for the productive and profitable employment of idle wealth which increases the wealth of economy and again the share of zakat.

Donations

Sadaqa is the one of the voluntary economic instrument. No limit and eligibility criteria for performing contributions to needy. It can be divert, apart from the eight heads mentioned for the distribution of zakat, to any needy. and it will strengthen what economic implications emerged by zakat.

Qard hasan

It is an arrangement of interest free loans for unproductive purposes or for the needy to meet the expenses like hospital expenses, home expenses and education expenses etc which are do not make any earnings. So it is not able to charge any material benefit, like profit share, from qurd hasan. These are provided as the part of kindness to human beings. In an Islamic economy individuals and institutions like Islamic banks will offer this type of loans expecting the reward of Allah. Availability of qard hasan reduces the financial burdens like interest, of deprived.

Profit and loss sharing

Islam formulates profit and loss sharing as the tool of trade contracts instesd of interest. The motivation behind it is the cooperation amongst the people. In profit sharing there are different types of financing such as mudaraba (profit and loss sharing) and musharaka (participation) ...etc
Mudaraba is the agreement between both capital owner and entrepreneur to share the profit arises from the business and in case of loss capital owner's capital reduces and entrepreneur's time and effort loose. Musharaka is the agreement to share profit and loss where all contributors participate in management of business. Both mudaraba and musharaka help the people, who have inadequacy of capital, to engage in business, production and contribute their share into the welfare nation and earn for their own.

Ganima (war booty), Khums (one fifth) and Fay

Ganima is the property Muslims seize from the enemy. Four fifth of the ganima is divided among the fighting army and one fifth (khums) of the entire ganima move to state fund, which is earmarked for the special beneficiaries mentioned in Quran. Fay is the property receives from the enemy without actual fighting. This source of state revenue is generalized for the common good of the entire population and public welfare.

Kharaj (Land- Tax)

Economic Development in Singapore

Singapore's history is one of riches and romance spice trading and piracy, colonialism and growth. In the 7th century, she was the Temasek, the trading center of Sumatra's ancient Srivijaya empire.

In 1963, Singapore was part of a political and economic alliance formed between the Federation of Malaya, Sarawak and North Borneo which is now Sabah under the nation of Malaysia. This alliance, proposed by the Malayan Prime Minister Tunku Abdul Rahman, was called Malaysia, and proved to be short-lived.

In 1965, Singapore separated from the Malaysian Federation to become an independent republic. Over 45 years, Singapore has relentlessly pursued the goal of becoming Asia's Pre-eminent center for tourism, trade and finance, by developing education and technical training programs, investment strategies, aviation and environmental policies.

What Economic Development Agencies Can Learn From How Private Businesses Treat Their Customers

I've worked for a number of small, private sector companies in the US and worked with others from the UK, all trying to grow their international business. I've worked for them in good times and in pretty bad times. But they all had one thing in common - when they got customers, they paid a lot of attention to looking after them.

You can see the same principle at work among the information marketers - like us, people who rely on making their way in the world by providing useful information that others can use to improve their own situation. And the one thing that the best of them do - and consistently - is to keep in contact with their current customers.

Business Investment Opportunities - How to Start a Business at an Affordable Price

In olden days doing a business was considered the biggest act. But now days the trend has been changed. With less amount of capital one has good business investment opportunities which will be profitable at the end if brilliant business techniques are followed. Innovative skills are of great importance which will be useful to make money with low investments. One can get numerous career opportunities through this and can reach higher levels which will make them shines as good entrepreneurs.
Apart from investments, skills and knowledge are the basic constraints to sustain in business. One can select the sector of their business based on their skills. Many categories like food, information system, web designing, art and entertainment. There are equal amount of opportunities in each case provided that they have good knowledge about it.

Property Investing - The Best Investment Opportunity

You need to research before you get involved in property investing. You need to buy the right property in the right location to attract the best tenants. Co-ownership has advantages because you can afford a more expensive property with the possibility of greater capital gains. However, you must have legal agreements in place. Buying a property with a friend or a family member is an effective way for first time buyers to overcome some of the financial barriers when property investing. If you choose this investment road, make sure you join forces with someone you trust!

Most people believe that property investing represents the best investment opportunity. Australian property has been the high achiever in terms of capital growth for many years, doubling in value on average around every ten years. Although past performance is no guarantee of future returns, there are indications that property will continue to be an astute investment. Property investing can build your wealth. Often a property portfolio can increase your personal wealth more than your day-to-day income. In Australia, investors can borrow up to 80 per cent of a property purchase price. In fact some mortgage brokers will loan up to 95 per cent. This means you can grow your portfolio from a low base.

How to Spot Good Investment Opportunities

For people looking to secure their future with some safe investment opportunities, it may be a good idea to begin your research early and embed some investment facts into your brain. Like with any investment opportunity, one never knows how much profit (if any) they will make. There are always risks involved with investing one's money, but the trick is to never place all of your eggs into one basket. Common sense will tell you that doing that is a terrible way of investing and you could risk losing everything in one fell swoop.

So how can one make a solid good investment? How do you spot good investment opportunities? Is there such thing as a good investment opportunity? Well the answer to the last question is that of course there is such a thing as a good investment opportunity; the trouble is no one really knows when that opportunity is and whether they should take it. The business world calls this financial investment which can make good profits. If you are financially astute then a good investment opportunity will lie in stocks, real estate and other ventures.

People should be careful if they are looking into property investment due to the current market, however as houses have become cheaper to buy this might be a good opportunity to buy a house for when prices do increase, which may enable you to make a good profit or give you the opportunity to rent the property out for a steady income. Again you will need to do some researching and take a careful approach to this as it may mean learning a few tricks before diving into it.

Economic Development

Readers and viewers must know the basic concepts and principles of economic development. After this, will be economic problems and development strategies that is applied in this article. The next part is development policies and programs that has something to do with monetary and fiscal policies in. It will be discovered as a process for an economic planning towards developmental model. Last but not the least, will be the major issues in economic development.

According to Fajardo in his book, "Economic Development defines as a progressive process of improving human conditions such as reduction or elimination of poverty, unemployment, illiteracy, inequality, disease and exploitations. To understand this meaning carefully, it is an interaction of different factors". The example of this is investing a rice harvest per hectare in your designated ranch, there are various inputs that are combined like fertilizers, insecticides, irrigation, technology, and many other things related to this example.

Economic Development in Asia

Economic Development in Asia shows high impact of economic development of this respective continent. Readers and viewers must take note that the economy of Asia is an integral part of the world's economy.

This continent have adopted one of the following economic systems such as capitalism, communism, socialism, and facism.

Asia is the largest continent in terms of area and population. It is also the region with the highest growth rate.

Here are Asian countries that contributes their economic development to our society.

Of all the Asian Countries, Japan is the only Asian country included among the indsutrialized countries.

Taiwan, Hongkong, and Singapore are known as "Little Japan" which considered as Newly Industrialized countries.

Rural Economic Development Tips and Strategies

The rural parts of America are a great place to live, but many communities are challenged to attract job-creating industries that will keep the younger generation from moving away. With the decline of so many of our resource-dependent jobs, such as logging, mining, farming, and fishing, there is a real need for rural community economic development work to be done.

I learned a few things while working with a number of timber-dependent rural communities during the Spotted Owl Wars of the early 1990s in Oregon and they may still be of use to those who are perhaps volunteers "in the trenches", trying to keep their rural communities alive and healthy. I don't like to be gloomy, but the challenges facing rural communities in a global economic slowdown would appear to be a lot worse than those my community faced in the mid-'90s.

Mobilising African People For Economic Development

For meaningful economic development to take place, the human resource available must be mobilized. For effective mobilization to occur, leadership must be seen to be democratic and understand human values and their sensibilities. Democracy is therefore at the centre of mobilizing African people for economic development.

I recently had a meeting with the Chairman of the Labour Party of Holland (PVDA) in Amsterdam and in the course of the discussion, she said 'I cannot imagine myself living without democracy'. The statement by this noble woman is very profound, very true and yet eluding many nations.

The number one resource of every nation or continent for her development is her people. At the centre of mobilizing people as said earlier is true democracy. Democracy should not end after elections, democracy means more than queuing and voting once every four, five or seven years for our leaders.

Cyprus - Condusive For Prime Property Investment and Stunning Golf Property.

Despite global slowdown and the economic climate looking tough Cyprus investment property has not lost its sheen. There is no dearth of opportunities for investment in the country because there are many factors combined that make this location an investment opportunity supreme. Particularly at the present time.

Cyprus is in close proximity to all major sea and air routes! The sun kissed island is growing more popular every year due to the closeness and the similarities to England resulting in resulting in an ever larger influx of tourists to Cyprus. The location of the country geographically too, is perfect because Cyprus intersects Europe, Africa, and Asia the three continents.  Cyprus is in close proximity to all major sea and air routes that cut across Europe, Arabian Nations and Far East. All of these factors contribute in making Cyprus an ideal investment destination.

Momentum Investing and Trend Following: The Secret to Significant Portfolio Returns

Two popular terms which often confuse investors are "trend following" and "momentum investing." Perhaps the most glaring commonality between these two is their blatant defiance of "buy and hold," the practice of selecting an investment and holding it indefinitely, believing that over time the market goes up, and therefore any investment will appreciate. Although the buy and hold approach has been touted for years by academics as the best method of investing, in reality it has its shortcomings, which are apparent in every Bear market.

Despite being the antithesis of buy and hold, both momentum investing and trend following strategies are predicated upon a disciplined investment approach that's designed to buy when the price of an issue is increasing and sell when the price is declining. Additionally, an exit strategy is normally incorporated to override the human tendency to hold losing positions much too long. Yet despite the distinct characteristics that these two terms share, in reality they are quite different.

What is Trend Following?

Economic Development in Latin America

Economic development in Latin America has been a matter of great debate since they became independent. In the nineteenth century, Europe and the United States thought the reason why there was a lack of development among Latin American countries was because they were racially inferior and Catholic. In the twentieth century, the reasons advanced was that they are backwards and uneducated. Latin American countries assert their lack of development is not because of the theories that first world countries put forth, but rather due to the fact that those same countries have stolen much of their mineral wealth and agricultural products during the colonial period. Since their independence, Latin American countries have went through four phases of economic development.

The Best Recession Proof Investment, Invest in Commercial Development

With corporate greed and corruption now the order of the day at Wall Street, and Chief Executive Officers (CEOs) that are more eager to collect multi million dollars in bonus checks than to secure Investors and Shareholders interests and returns on their investments, one has to ask these valid questions especially after what we witnessed recently with Lehman Brothers, Merril Lynch, Bear Stearn, AIG, etc: Are we better off saving our hard earned money under our mattresses as our grand parents did many years ago? Who can we trust today with our money? What is the safest investment with minimal risks?

Fiscal Deficit and Economic Growth

The planning commission deputy chairman rightly opined that growth takes precedence over deficit. In other words, the commission would like to concentrate on the economic growth now and about the deficit later. At present the fiscal deficit in Indian economy is about 11% of GDP. The government's goal is to bring it down to 3% of the country's GDP. The exclusive deficit of the central government is about 7% of the GDP. Some statistical organisations put India among some of the very high fiscal deficit economies.

Five year plans and investment:

The public investment for the development of the country has been increasing since 1951. For better services and to provide employment to the educated and skilled Indian citizens the public sector units came in to existence. Over the years due to mismanagement of these units, these have become a burden on the Indian economy though some of them have been contributing to the growth in the economy.

The Remarkable Story Behind Singapore Economic Development

Singapore economic development journey was not paved. Today Singapore vibrant economy is considered short of a miracle. Despite the many obstacles facing them, Singapore managed to attain prosperity in a short span of time.

The island city has some four million residents. Also considered as the smallest nation in the entire Southeast Asia, most Singaporeans live in high-rise buildings and commute using public transport.

In 1819, Europeans settled in Singapore. The British East India Company, managed by Sir Stamford Raffles, created a post for spice trading. Singapore became a commercial and military center of the British Empire in Southeast Asia.

Economic Development

Readers and viewers must know the basic concepts and principles of economic development. After this, will be economic problems and development strategies that is applied in this article. The next part is development policies and programs that has something to do with monetary and fiscal policies in. It will be discovered as a process for an economic planning towards developmental model. Last but not the least, will be the major issues in economic development.

According to Fajardo in his book, "Economic Development defines as a progressive process of improving human conditions such as reduction or elimination of poverty, unemployment, illiteracy, inequality, disease and exploitations. To understand this meaning carefully, it is an interaction of different factors". The example of this is investing a rice harvest per hectare in your designated ranch, there are various inputs that are combined like fertilizers, insecticides, irrigation, technology, and many other things related to this example.

Karnataka - Industrial and Economic Development

Karnataka has always been in the limelight because of the economic and industrial development in India. With many inborn talents and capabilities of business oriented citizens, Karnataka offers a superlative option for many investment opportunities. Also the Karnataka's industrial development has been pushed with on-going efforts from government.

Why so much of industrial and economic development has been witnessed in the state? Few reasons behind these are:

• Availability of the best human resource and trained technical personnel in Engineering and Management.
• Upgraded research facilities that have been originated in Central Government laboratories.
• Well developed transport facilities with well connected road, railway and air facilities.
• Superb communication facilities.

Economic Development in the World

In our planet Earth, all of us who are living are included in Economic Development. This is a global issue that we must face now a days. It also reflects the population in the whole world. Seven continents across the globe will meet together in the end in order to show economic cooperation for the global society.

The balance of trade from different countries must be solved at all cost based on import and export activities.

As of now, China is leading in the population growth while India leads the second but I am not producing babies for competing number of children.

Investing In A Developing Economy - A Possible Solution To Global Financial Crisis

INTRODUCTION

If there were security problems in Nigeria, no businessman would go to the country to explore opportunities, companies like Celtel, MTN, Etisalat, would not have ventured into security risk country to do business. Those who spread rumour about security and corruption problems in Nigeria are saying so to stop others from making money in the country. Figures don't lie. They are the biggest testimonies for how conducive Nigeria's environment for business and opportunities are. If you want to do business in Africa and record good returns on your investment, I welcome you to come to Nigeria. The political environment in Africa, particularly in Nigeria is tremendous.