Zakat and Poverty Alleviation among Indian Muslims

Approximately 40% of Muslims in India, i.e., 60 million out of 150 million individuals, live below the poverty line. This raises the debate about the power, potential and performance of zakat as a poverty alleviation mechanism. The potential and power of zakat as a poverty alleviation mechanism is beyond doubt. What seems to be debatable, and at the center of this paper, is the ineffectiveness of the prevailing zakat practice in reducing poverty. Muslims in India suffer from a lack of an effective system and planned use of zakat funds. The purpose of this study is to find out what are the major uses of zakat funds? What percentage of zakat is being used to alleviate poverty? Is there an alternative plan or model for a more effective use of zakat to eradicate poverty?