Fatwa on Interest Income Short-Sighted

May 19 2010No Comments

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The recent fatwa issued by the Darul-Uloom of Deoband states that the employment of women in public and private sectors is against the Shariat law and that the salary earned from the Bank employment is Haram since the wages are paid by the bank out of the interest income earned by the bank. Earning of interest is not allowed in Islam.

Now, this argument is carried too far. In these days of integrated organized economic activities it is near impossible to segregate an enterprise’s income into non-interest related income and purely interest income on a day to day basis. Hence rather impossible to identify on the expenditure as to which expenditure is out of interest earned and which is from non-interest income.

Let’s say we have a company which manufactures paper. At any point of time this company when saddled with excess liquidity would invest in interest bearing sovereign bonds and interest earned out of this investment comes in the general pool of revenue earned by the company. Now if an employee Y of this company receives salary from this company, can one say that this salary is Haram because it comes from the company manufacturing paper which activity is within Shariat law but which has also earned some interest on investment?

If the interpreters of Shariat law think so then the entire production expenditure would not be according to shariat law, since the raw materials’ cost too would have been met out of the interest receipts. The suppliers of these materials and services would then be earning income which is not Shariat-compliant. And finally if out of these papers the Holy Quran is printed then that too would be strictly speaking unislamic since interest income of the company has played a role in the production of these papers!

Similarly the cement that is used to construct the Madrasas too would be non Shariat-compliant. Thus every conceivable item of daily use would be against the spirit of Islam and everyone employed would be earning an income that is not acceptable to Islamic laws. Thus obtaining a product or a service where interest element does not form a part of it will be a near impossible task.

Can we ask the guardians of Islamic laws to emulate by using articles and services of daily necessities where interest has not played a positive role and then expect believers to follow them? I am sure that would starve them of a decent existence. Shariat law interpreters should promote harmony of existence in the complex modern world then create conflicts and chaos.

I am sure that’s the spirit of the Shariat law!

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