Fasting, Inflation, and Economic Values

Fasting educates Muslims to be more frugal, not to increase shopping or crowded markets and malls.

The following article was translated using both Microsoft Azure Open AI and Google Translation AI. The original article can be found in Puasa, Inflasi, dan Nilai Ekonomi

These two words, namely puasa and inflasi, are not actually part of the group of words that have close meanings. The word puasa is commonly used to explain one of the models of worship practices carried out by Muslims once a year, while the word inflasi belongs to the category of words related to monetary economics.

However, these two words have a unique correlation to the religious life of Indonesian Muslims, especially before the arrival of the month of Ramadan.

Why unique? Because there is a factual anomaly that should not happen in the religious tradition of Muslims in Indonesia. In reality, every time before fasting, and even continuing until the day of Eid al-Fitr, inflation usually occurs, marked by a rise in the prices of basic necessities. But this phenomenon is not peculiar only to Indonesia, it occurs in many countries around the world.

In microeconomics, one of the factors causing inflation is the imbalance between the supply and demand sides of the market. This could be because the large demand force is not balanced by an increase in supply volume.

Also read: Maintaining Food Inflation

The atmosphere of traditional markets or supermarkets in Indonesia before fasting is usually crowded with people who want to shop for their daily needs during fasting. This means that from the demand side it is experiencing quite large volume pressure.

Consumer behavior leading up to and during the fasting month has depicted an abnormal condition. Transaction volumes have surged sharply. This phenomenon, on one hand, has a positive impact on the economy of society. The larger turnover of economic transactions will lead to an increase in the income of the community.

This fact actually creates a paradox with the essence of fasting itself. The essence of fasting is to reduce consumption activities. Usually, outside the month of Ramadan, Muslims are not limited in their consumption of goods. Access to consume goods is wide open. For 24 hours you can consume it.

The essence of fasting

However, the atmosphere will be different when entering the holy month of Ramadan. Muslims are no longer free to consume goods. Starting from the dawn call to prayer until the setting of the sun before Maghrib prayer, Muslims are limited to consuming goods, whether in the form of food or drink.

This means that, from an economic perspective, there should be a reduction in consumption. If we refer to the nature of fasting, the demand side should experience weakening, decreasing along with cutting consumption patterns which are only done at night.

If calculated by the hour, the freedom to consume during the night is only 10 hours. The remaining 14 hours, calculated from the beginning of the Subuh prayer until the beginning of Maghrib time, are the prohibited time for consuming activities. If seen from the ratio of the allowed and prohibited time for consumption, the prohibited time is certainly longer, with 14 to 10 ratio.

However, the reality is not as desired by the nature of fasting. The fact is that the demand side has experienced quite a strong strengthening. This is what is meant by anomalous facts leading up to and during the month of Ramadan. If we refer to the nature and essence of fasting, the demand side should not be strengthened, but on the contrary weakened. As a result, the supply side must rebalance its position by increasing the supply volume.

Fasting is not to be responded to by increasing spending or overcrowding the market and malls.

Usually, in conditions like this, to avoid extreme inflation, it is possible for the government to take steps to intervene in the market by increasing the supply of goods through open market operation instruments.

The anomaly above needs to be changed. To change this paradigm, a deep understanding of the essence and nature of fasting in the month of Ramadan is required. Indonesian Muslims need to understand the true meaning of fasting as a form of worship. Fasting is not to be responded by increasing spending or making markets and malls more crowded.

On the contrary, the fasting ritual during the month of Ramadan is the best opportunity to increase the quality of our devotion to Allah SWT. The month of Ramadan is the perfect time to enliven the mosque with various forms of worship prescribed in Islamic teachings, both mandatory and optional.

The month of fasting is the month in which Allah SWT provides the greatest opportunity for Muslims to perform worship. Allah SWT promises multiple rewards for Muslims who perform worship in the month of Ramadan.

In fact, worship that is included in the category of sunnah practices in the month of Ramadan, such as Tarawih prayers, almsgiving,or reading the Koran, for Allah SWT the rewards are equivalent to performing obligatory worship.

KOMPAS/PRIYOMBODO

Children learn to recite the Quran in the Said Na'um Mosque in Kebon Kacang, Tanah Abang, Central Jakarta, on Thursday (24/3/2024). Every day, many children can be found studying the Quran after school.

Economic value

Fasting teaches life behavior that is far from consumeristic. The meaning of fasting is to restrain (al-imsak). Restrain your desires so you don't lean towards consumeristic behavior. Restrain your desires not to indulge yourself with materialistic things.

Fasting educates Muslims to be more frugal instead of squandering their money on shopping. From this, it can be revealed that one of the wisdoms of fasting in the month of Ramadan is to teach Muslims to not behave in a consumeristic lifestyle, namely spending their wealth based on needs rather than mere desires.

On the other hand, fasting is an economic instrument to reduce debt behavior. Currently, Muslims in Indonesia can easily access loans through financial institutions in Indonesia. Moreover, with the rise of online loans (pinjol), access to debt is getting easier.

It is true that there is no prohibition against borrowing, but with the presence of the fasting instrument, at least we can control the habit of borrowing. It is true to make a guideline from a string of wise words, "It is better to fast than to borrow."

From a macroeconomic standpoint, it is time for the Indonesian Government to "fast" from further debt.

In fact, there are two options for people who want to fulfill their needs when they don't have enough money. First, by fasting while saving money by prioritizing saving behavior (saving). Once the money is collected, then they can meet their living needs.

Secondly, by "forcing" themselves through the process of borrowing money from other parties, either personally or through financial institutions. This second method is relatively frequently practiced by the community because access to obtaining loans is quite easy.

From a macroeconomic perspective, it is high time for the Indonesian government to "fast" from increasing debt. Currently, the country's debt stands at Rp 8.253 trillion according to data released by the Ministry of Finance as of January 31, 2024.

It is not wrong to put Indonesia in the category of countries that are developing amidst the whirlwind of debt. However, we must ensure that Indonesia does not become one of the countries that fail to pay off its debt obligations. If we calculate the total amount of debt above, each Indonesian citizen will bear a government debt burden of Rp 30.5 million per person.

Also read: Recurring Debt Problems

In conditions like this, the government should enter a period of imsak, refrain from adding new debt. It is good that the knowledge of the Prophet Yusuf, when asked for menta'wil, the dream of the King of Egypt could be used as a reference for building a just and prosperous Indonesia, gemah ripah loh jinawi, as an illustration of the realization of the state baldatun thayyibatun wa rabbun ghafur.

At that time, the Prophet Yusuf gave advice to the King of Egypt to be frugal, restrain himself (imsak) by limiting consumption followed by saving behavior for a period of seven years. The development model implemented by Prophet Yusuf can be used as a reference in Indonesia's future development process.

More than that, fasting can be interpreted as an educational process for Muslims to forge themselves so they can further foster social solidarity. It is hoped that we will also experience how life is like for our other brothers and sisters who happen to still be deprived.

AM Hasan Ali, Lecturer in Sharia Economic Law at UIN Syarif Hidayatullah Jakarta; Founder of Sharia Business Intelligence (SBI)