3(b) Land as a Factor of Production

Islam has recognized land as a factor of production. In classical writings, land includes not only the surface of the earth but also all natural and mineral resources and other free gifts of nature. There is no evidence to prove that Islam does not approve this definition of land. But the way Islam looks upon land as a factor of production has its own distinctiveness which can be expressed in terms of productivity and distributive justice and inter-generational obligation. Thus the utilization and maintenance of land as a factor of production can be seen at least from three ways within the framework of an Islamic economic society:
(i) Land in the process of cultivation;
(ii) Land as natural resources; and
(iii) Land as exhaustible existence.

(i) Land in the process of cultivation.

Both the Qur’an and the Sunnah have laid down much emphasis on the proper cultivation of the land. The Qur’an has categorically drawn attention of Muslims to make use of the wasteland by turning it into garden by making appropriate arrangement for watering it and growing good crops. This emphasis on increased agricultural production is significant in case of many Muslim countries which are not yet self-sufficient in food production. This is also significant in case of those countries where most of the land belongs to non-cultivator owners or where the distribution of land is inequitable giving rise to emergence of a class of landless labour. Because the Prophet (be peace on him) tried to impress upon his followers to cultivate land by themselves. For, it is expected to ensure proper and efficient cultivation of land. Wastage of land in any form is condemned. But cultivation of land should not be the only occupation of the people in an Islamic State. The State can make rules to ensure that land as a factor of production is used in such a way that the objective of the balanced growth is achieved for the benefit of the community.

(ii) Land as Natural Resource.

A Muslim can acquire ownership of the natural resources after fulfilling his obligations towards his society. The use and maintenance of the natural resources can give rise two components of earnings. These are:
(a) earning from natural resources on its own right (i.e. pure economic rent) and
(b) earning from the improvement in the use of natural resources through human labour and capital; while the pure economic rent must be shared equally by all members of the community, one is entitled to proper compensation for human effort (i.e. wage and profit). It is therefore important to separate pure economic return from other factor compensation resulting from the use of natural resources.

(iii) Land as Exhaustible Resource.

It is an Islamic viewpoint that exhaustible resource belongs to the present as well as future generations. The present generation have no right to misuse the exhaustible resources now which may cause harm to the future generations.
From the above analysis, the following hypothesis or policy guidelines can be derived:
(a) The agricultural development in Muslim countries can be accelerated through intensive and extensive method of cultivation if it is supplemented by a program of moral education.
(b) The revenues generated from the use of exhaustible resources should be spent more on the development of social overhead (i.e. university, hospital) and physical infra-structure rather than current consumption.
(c) The pure economic rent may be spent more to meet current consumption expenditure.