Assalaamualaykum
What are your thoughts on the shariah compliance of carbon credits and carbon credit futures?
Wasalam
May Allah bless you.
Some Muslim “economists” believe its not permissible to trade carbon credits, as carbon is a form of impurity in their view. And the general Islamic rule is that one cannot sell an impure thing such as blood, urine etc…You may want to reflect on this point…
I am in favour of protecting the environment and I strongly believe that we should all try to do our bit (see link: Muslims and the environmental crisis – Shariah Consultant)
However, the reality is there are lot of things hidden from us when it comes to the role of investment, and the protection of the environment.
Some things are being done in the name of protecting the environment, when behind the scene something else is taking place. A simple example would be how solar panels are being promoted to tackle global warming issues and yet, the way the minerals are being extracted in order to create these panels can be shocking (pollution of the environment during the extraction process, report of slavery including of Muslims slaves etc). To get an idea, one book which has been translated to English from French is worth reading: La Guerre des Metaux Rares The Rare Metals War by Guillaume Pitron.
So to answer your question, I believe that we need a deep insight not only from the fiqh perspective but also by understanding the true wisdom, and the real impact trading carbon credit has on the environment and societies.
Kind regards