What is Dinar ?
The modern Islamic gold dinar (sometimes referred as Islamic dinar or Gold dinar) is a bullion gold coin made from 4.25 grams of 22-carat (k) gold that is a recent revival of the historical gold dinar which was a leading coin of early Islam. It is separate from the currencies of various states that use the dinar as a denomination.
According to Islamic law, the Islamic dinar is a coin of 22k (91.7%) gold weighing 4.25 grams. The Islamic dirham coin is 2.975 grams of pure silver. Umar Ibn al-Khattab established the known standard relationship between them based on their weights: “7 dinars must be equivalent (in weight) to 10 dirhams.
“The Revelation undertook to mention them and attached many judgements to them, for example zakat, marriage, and hudud, etc., therefore within the Revelation they have to have a reality and specific measure for assessment of zakat, etc. upon which its judgements may be based rather than on the non-shari’i other coins.
Know that there is consensus [ijma] since the beginning of Islam and the age of the Companions and the Followers that the dirham of the shari’ah is that of which ten weigh seven mithqals weight of the dinar of gold… The weight of a mithqal of gold is seventy-two grains of barley, so that the dirham which is seven-tenths of it is fifty and two-fifths grains. All these measurements are firmly established by consensus.”
As a consequence of the currency crisis in Asia, in the first part of 1997, then Prime Minister of Malaysia Mahathir bin Mohamad proposed introduction of Islamic gold dinar as currency for international trade in the Muslim world. It was intended to replace the United States dollar and, as a gold-based currency, provide a medium of exchange more stable than the dollar. Mahathir announced that Malaysia was to start using the dinar in mid-2003, but when in 2003 Abdullah Ahmad Badawi replaced him as Prime Minister of Malaysia, this idea was halted.
Gold dinar in Malaysia
On the 20 September 2006, Kelantan became the first state to launch gold dinar coins. It features the Kelantanese state crest, the date of production, as well as the weight and purity of the gold used on its face. The Dinar Emas Kelantan (DEK) is similar to the original dinar in weight and purity of gold used. The coins can be bought and sold at the Kelantan Corporation Berhad (Perbadanan Kelantan Berhad) and all eight Ar-Rahn Islamic pawnshops in the state.
Common uses of the gold dinar include:
1. Saving them, because they are wealth in themselves.
2. Paying zakat and dowry as established within Islamic Law.
3. Buying merchandise from outlets.
4. Holding accounts, and making and receiving payments as with any other medium of exchange.
Gold dinar in Indonesia
In Indonesia, Dinar and Dirham is only produced by Logam Mulia – PT. Aneka Tambang TBK. Currently, only Logam Mulia who are technologically capable to produce Dinar and Dirham in accordance with the Dinar and Dirham standard in the early days of Islam (4.25 g of 22 carat gold).
Standard of levels (carat) and weight is not only nationally certified by the National Accreditation Committee of Indonesia (KAN), but also by the institutions of international certification of precious metals which is well recognized i.e. London Bullion Market Association (LBMA).
As at the beginning of Islam that emphasizes the Dinar and Dirham in weight and levels – not in writing or the number / size / shape pieces – the weight and gold content for the Logam Mulia’s dinar and silver dirham production in Indonesia is eligible to be mentioned as the Islamic Dinar and Dirham today.