Stock market trading has generated considerable anxiety among the Muslims the world over.

Islamic Investment Opportunities in India - Young Muslim Digest | Young Muslim Digest

Fundamental Islamic provisions of Halal trading and interest-free economy lead the religious circles as well as the intellectual classes resort to varying, and some times comical, interpretation of these Divine injunctions. The Fatwa from the Islamic Fiqh Academy, New Delhi sometime back has compounded the prevailing confusion further.

It has to be borne in mind that interest is the worst form of Haram business in Islam and any company which directly or indirectly engages in it is unworthy of investment from the Islamic point of view. According to the above Fatwa, a Muslim can invest in the equity shares rather than the bonds and debentures of a company which is engaged in only Halal business.

Take the top corporate giants of India which are basically engaged in Halal business and their end products and services too are Halal. One shall be astonished to look at the capital structure of these companies as more than half of the capital of these companies comes from debt instruments such as interest carrying debentures, secured loans and other borrowing from commercial banks and financial institutions.

In fact a company is said to be based upon strong fundamentals whose debt-equity ratio is in the range of And nearly all these companies conform to this criterion mostly. The moot point here is can a company be bracketed under Halal business concerns just because its finished goods and services are Halal even though the majority of its capital islamic share trading india finance comes from debt and interest-carrying loans.

Take these top Halal companies again.

Investing in stock market: the Shariah way, The Milli Gazette, Vol.6 No, MG ( July 05)

It is a bare fact that these companies park their reserves and surplus capital in high-yield and fixed income debt instruments and government securities. And sometimes the returns from these investments far exceed the income from their declared business. At times of boom in the economy, companies usually earn more than per cent on their investments. But they pay back penny stock brokers usa debtors only the pre-determined interest of say 20 per cent and pass the benefit of the remaining 80 per cent to their equity share holders besides their own per cent entitlement.

Under this scenario the profit-sharing of the debtors and the equity share holders would be 20 per cent and per cent respectively. Conversely, at times of economic recession, companies could hardly earn anything, westfield bondi australia day opening hours even the debt servicing has to be met with from the share of the equity share-holders such as company reserves and further borrowing.

In the former case if the equity share holders get abundantly benefited from the Haram investment of the debtors, in the latter case, it is the turn of their Halal investment to get the raw deal at the hands of the Haram one.

The fundamental question here is does Islam permit the intermingling of Halal and Haram investments with such dire consequences, and that too of the present magnitude?

investment - Is investing on stock market Haram? - Islam Stack Exchange

How can the stock-market trading be termed Halal then? News from Islamic World EDITORIAL Trading in Stocks Trading in Stocks Stock market trading has generated considerable anxiety among the Muslims the world over. It is strange that the same Fiqh Academy has very recently permitted not only insurance of property but of life as well which are the mother of all Haram investments.

Obviously, it had in its mind the 65, odd anti-Muslim riots of the post-independence era. But with this same logic prohibition of interest too stands diluted largely.

Islamic Investment Opportunities in India

If you have swallowed a camel why strain at a gnat then? Political wisdom and public will might not allow us to go public with this contentious issue at the moment. But the Fatwa is an unambiguous subscription to this contention from the back-door.