Rasulullah Sallallahu Alayhi wa Sallam once stated on the occasion of Eidul Fitr, “Verily, every nation has a day of religious celebration and today is our day of celebration.” Bukhari
As Muslims we do not participate in the religious celebrations of other faiths. Living in a multi-faith society does not mean that we sacrifice our values to appease others. We respect the right of others to celebrate as they wish but this does not mean that we need to do the same.
There is nothing wrong with saying, “I am a Muslim and I do not celebrate or participate in Diwali celebrations.”This will gain you respect by displaying your faith and adherence to Islam.
Fireworks are impermissible in Islam as it is considered an extravagant waste of money. However when the use of fireworks becomes part of the religious celebration of others, the severity of the sin increases many times over.
Muslim businesses should realise that their sustenance comes from Allah and not by adopting avenues that displease Him. What may be gained materially in the sale of unlawful goods proportionately depletes the Barakah and blessings of our sustenance.
So while Diwali is a time of celebration for Hindus, it is definitely not one for Muslims. We need to be clear on such issues so that Islam is preserved in its purity for our progeny to come.