ECONOMIC DEVELOPMENT IN ISLAMIC PERSPECTIVE REVISITED AUSAF AHMAD Presentation at Pune College, Pune, India March 09 -11, 2012 5/7/2018

In the name of Allah the most Gracious The Most Merciful

This Presentation Includes -1: An Introduction Some Observations on Development and Islamic economics Some observations on Islamic Strategy of Development Islamic values and Development Values Some Lessons from Hisry: Scientific basis, Increases in productivity and Role of institutions. 5/7/2018

This Presentation Includes -2: Towards a Development Strategy in Muslim Countries: Application of modern science Investment in Human capital Balance between Market and State Some Observations on Islamic institutions: Islamic financial institutions Zakah institutions Waqf institutions 5/7/2018

This Presentation Includes -3: Concluding Remarks. A more comprehensive model of development Development strategies of the Islamic world must reflect ‘ground realities’. Instead of speaking of high ideals, Muslim countries may assign a developmental role to existing institution. Developmental role may particularly be assigned to existing institutions of Zakah, Awqaf and Mosques 5/7/2018

INTRODUCTION-1 More than 25years ago, a prominent Islamic thinker spoke of a challenge before the Islamic Ummah. This is the Challenge of Development. The Challenge remains as strong now as it was then. The political economy of International Economic system has drastically changed during this period. 5/7/2018

. INTRODUCTION- 2 [Contd] The map has been redrawn. The demise of the Soviet Union. The idea of ‘ catching up’ is no more as mismerizing as it was once. The industrialized countries are developing at a faster rate, and gap between the rich and poor nations is increasing New forms of neo-colonialism: near monopoly situation in trade, technology and finance. 5/7/2018

INTRODUCTION -3 [contd.] The ‘defeat’ of the Socialist system does not mean a victory for the capitalist system which has its own problems. Skewed distribution of income and wealth. Poverty, economic injustice, inequality of opportunities, crime, inflation, cycles are some of the diseases of capitalist system Both systems were devoid of any moral content. 5/7/2018

Development and Islamic Economics Economic development has been a neglected area in Islamic economics The point of reference has been a seminal paper by Khurshid Ahmed that was presented at the First International Conference on Islamic economics held in Makkah in 1973. 5/7/2018

Development in Islamic Persprective-1 Khurshid Ahmed starts with the concept of development and reiterates its holistic nature. He emphasizes that Islamic concept of development is based on four Islamic notions: Tawheed: Oneness of God Rububiyah: Divine Providence Khilafah: Man is God Vice gerant on Earth Tazkiyah: Purification and Growth The main criterion on which Development as a human experience, must be evaluated is that what it does to lives of people. 5/7/2018

Islamic Strategies of Development Khurshid Ahmed then identifies an Islamic strategey t to Development Can there be “an Islamic strategy of development?” Or there could be several “Islamic” Strategies of development. Apparently different authors have suggested different strategies. Khurshid Ahmed, Chapra, Siddiqi, M. A. Mannan have given different strategies. 5/7/2018

Islamic Strategies of Development -1[Contnd.] Most of suggested Strategies are nothing but “tall orders” requiring far reaching changes in the political and economic structures. Till such time that these changes occur, these strategies constitute mere “academic exercises”. 5/7/2018

Development and Islamic Economics Development has remained a neglected area for too long. Lately researchers in the area have turned their attention to it. Publication of scholarly articles and books, organization on seminars, conferences and symposia etc. are different manifestations of this interest. 5/7/2018

Islamic Values and Development Values Rational approach, self interest, sanctity of private property, profit motive, negation of parochial approaches are identified as some of the development values. Islam emphasizes a universal and human approach in all matters concerning human beings. It enjoins justice and fairness in human dealings. It encourages rational enquiry and freedom of action. 5/7/2018

Islamic Values and Development Values-2 It may be argued that there is no inherent conflict between the values by Islam and the values required for development. The reasons for the apparent backwardness of Muslim societies must be sought some where else. For example in colonial rule and mismanagement of the economy. 5/7/2018

Lessons from History 1. Scientific Revolution 2. Increases in productivity per worker 3. Role of institutions and policies Some Muslim countries have shown dynamism in the recent past establishing new development institutions. Tabung Haji in Malaysia and Grameen Bank in Bangladesh may be cited as examples. 5/7/2018

Towards an Islamic Strategy of Development in Muslim Countries Desirability of Development Ingredients of an Islamic strategy Application of modern science and technology Investment in Human capital Balance between Market and State Role of Islamic institutions 5/7/2018

Institutional Development in Muslim Countries Islamic Financial Institutions Zakah Institutions Awqaf Institutions Islamic Institutions and Resource mobilization 5/7/2018

CONCLUSION A more comprehensive concept of development Muslim economists have traced the reasons of non performance of Muslim countries in adoption of western models and inappropriate strategies. Lessons from history and ground realitries Developmental role of existing Islamic institutions. 5/7/2018

THANK YOU FOR YOUR PATIENCE ! 5/7/2018