Difference between Privatization, Nationalization and Iqta‘ (Allocation of Land)

প্রশ্ন · Question

Asalamu Alaikum WA Rahmatulah Wa Barakatuhu

What is the difference between privatization in the capitalist system
and Iqta’ (allocation of land) that is mentioned in the book, Funds in
the Khilafah "Caliphate" State?
Jazak Allahu Khair

উত্তর · Answer

Wa Alaikum As-Salam Wa Rahmatulah Wa Barakatuhu,
1- There are three types of ownership: public property, state
property and private property - whatever that is not included in the
public and state ownership.
2- Public property are the items that the legislator made their
ownership belong to all Muslims, a joint ownership between them,
and prevented individuals from their ownership, such as electricity
generators, power plants, gas factories, coal, and minerals that are in
abundance, that are not limited, whether solid such as gold and iron,
or a liquid such as oil, or gas such as natural gas, all of these and
similar ones are public property owned by all Muslims, shared
ownership, and it is a source of funds of Bait ul Mal of Muslims,
distributed by the Khalifah to them, in accordance with the Shariah
rules.
3- State ownership is any piece of land or building connected to a
right of all the Muslims; it is separate to public property. State
ownership can be of land, buildings, transferrable objects, that are
linked to a right of the general Muslims according to Shariah rules,
the Khalifah has the authority to manage, monitor, and make
decision regarding the property.
4- Although the state manages the public property, and manages the
state property, yet there is a difference between the two ownerships.
All that comes under the public property, such as oil, gas, and
abundant minerals, seas, rivers, springs, squares, bushes, grasslands,
and mosques, it is not permissible for the Khalifah to give its

ownership to any one, whether an individual or group; because it
belongs to all the Muslims collectively.
As for what constitutes state ownership of the land, and buildings,
then the Khalifah can give their owner to individuals, and the title
(ownership) and benefit, or benefit without ownership (of the neck),
or to allow them to be revived and owned, and he can dispose of it in
the manner that he sees for the interest of the Muslims
5- The Khalifah has permission to give from the state ownership of
land for the one who does not have agricultural land, the person can
cultivate it and it becomes his property, so that wealth does not
remain confined only in the hands of the rich but it should be
circulated:
يْ لََ يَكُونَ دُولَةً بَيْْ َ الَْْغْنِيَاءِ مِنْكُمْ
(كَ
so that it will not be a perpetual distribution among the rich from
among you” [Al-Hashr: 7]
However, the Khalifah has no permission to take away from
someone’s private property wrongfully and then gives it to another,
but he can give from the state ownership for the poor and not the
rich; which is called the allocation of land.
Iqta’ (allocation of land) is taken from the state’s land and not from
private property and of course not from the public property.
6- These properties are stipulated by the Shariah rules, it is not
permissible to change its classification, so the public ownership is not
changed to private ownership, like giving the right for oil exploration
and extraction to a private company, the so -called "privatization",
this is turning public property to private ownership. Likewise it is not
permissible to transfer private property to state property, like taking
away by force the shop of a person and is made the ownership of the
state which is called nationalization.

7- It is clear from above to see the difference between privatization,
nationalization and Iqta’ (allocation of land). Privatization is the sale
of public property to private companies, such as giving the privilege
of oil exploration or mining or electricity to private companies, which
is forbidden. This is because public ownership remains public
property and does not become private property ... Nationalization is
to change the individual private property to the ownership of the
state or to public property, like turning a shop from individual
ownership to public ownership or state ownership, and this is not
permissible because the properties remain a possession of their
respective owners, and this right is not alter to other than the owner.
As for Iqta’, it is when the state gives from its ownership to
individuals, raising their economic standing, and does not leave the
wealth confined and circulating among the rich, and many people do
not possess what they can live by in dignity and pride, thus the state
gives land to some of those who have no land to cultivate, and it
gives from its funds also to farmers and help them to cultivate their
land.
Thus Iqta’ in Islam in the Fiqh understanding is different from
nationalization and different from privatization.
Your brother,
Abu Yasin
03 Rabii’ II 1438 AH
01/01/2017 CE