In the first place, we would like to stress that Muslims should have good relations with all people of every religion. At school, at work, in the neighborhood, et cetera, a Muslim should be kind and courteous to everyone. Islam teaches its adherents to interact with all people and cooperate for the good and betterment of the whole mankind. Islam encourages Muslims to cooperate with everyone regardless of his/her religion or creed in all projects that are virtuous or beneficial to humanity or other creatures of God.
In this context, the eminent Muslim scholar Sheikh Al-Qaradawi states in his well-known book ‘The Lawful and the Prohibited in Islam’:

First of all, we would like to stress that Islam does not prohibit Muslims from being kind and generous to peoples of other religions, even if they are idolaters and polytheists. However, Islam looks upon the People of the Book, that is, Jews and Christians, with special regard, whether they reside in a Muslim society or outside it.

The Qur’an never addresses the Jews and Christians without saying, “O People of the Book” or “O You who have been given the Book,” indicating that they were originally people of a revealed religion. For this reason, there exists a relationship of mercy and spiritual kinship between them and the Muslims, all having in common the principles of the one true religion sent by Allah through His Prophets (peace and blessings are upon them all): He says, (He has ordained for (the Muslims) the same religion which He enjoined on Noah, and that which We have revealed to thee (Muhammad) and that which We enjoined on Abraham, Moses, and Jesus: that you should establish the faith and make no division in it….) (Ash-Shura 42: 13)

Muslims are required to believe in all the Books revealed by Allah and in all the Prophets sent by Him, otherwise they are not considered true believers. Allah says in the Qur’an: (Say: We (Muslims) believe in Allah and in what He has revealed to us, and in what He revealed to Abraham and Ishmael and Isaac and Jacob and the tribes (of Israel), and in what was given to Moses and Jesus, and in what was given to (all) the prophets by their Lord. We make no distinction between any of them, and to Him do we submit.) (Al-Baqarah 2: 136) Consequently, if the People of the Book read the Qur’an, they will find in it praise for their Books, Messengers, and Prophets.

In having dialogue with the People of the Book, Muslims should avoid such approaches that may cause bitterness or arouse hostility; Allah says, (And do not dispute with the People of the Book except by (the way) which is best, unless it be with such of them as transgress, and say, ‘We believe in what has been sent down to us and sent down to you, and our God and your God is one, and to Him do we submit.’) (Al-`Ankabut 29: 46)

We have already seen how Islam permits eating with the People of the Book, sharing the meat they slaughter, and marrying their women, marriage being a relationship of mutual love and mercy. Almighty Allah says: (…The food of those who were given the Scripture (before you) is permitted to you and your food is permitted to them. And (lawful to you in marriage are) chaste women from among the Believers and chaste women from among those who were given the Scripture before you….) (Al-Ma’idah 5: 5)

Non-Muslim Citizens of a Muslim State

The above injunctions include all People of the Book wherever they may be. However, those people who live under the protection of an Islamic government enjoy special privileges. They are referred to as “the Protected People” ( AhlAdh-Dhimmah or Dhimmis), meaning that Allah, His Messenger (peace and blessings be upon him), and the community of Muslims have made a covenant with them that they may live in safety and security under the Islamic government.

In modern terminology, Dhimmis are “citizens” of the Muslim state. From the earliest period of Islam to the present day, Muslims are in unanimous agreement that Dhimmis enjoy the same rights and carry the same responsibilities as Muslims themselves, while being free to practice their own faiths.
the Prophet (peace and blessings be upon him) emphasized the duties of Muslims toward Dhimmis, threatening anyone who violates them with the wrath and punishment of Allah. The Prophet is reported to have said: “He who hurts a Dhimmi hurts me, and he who hurts me annoys Allah.”(Reported by At-Tabarani in Al-Awsat with good chain of narrators.)

He also says, “Whoever hurts a Dhimmi, I am his adversary, and I shall be an adversary to him on the Day of Resurrection.”(Reported by Al-Khatib with authentic chain of narrations.)
On the Day of Judgment I will dispute with anyone who oppresses a person from among the People of the Covenant, or infringes upon his right, or puts a responsibility on him which is beyond his strength, or takes something from him against his will.” (Reported by Abu Dawud)

The successors of the Prophet safeguarded these rights and sanctities of non-Muslim citizens, and the jurists of Islam, in spite of the variation of their opinions regarding many other matters, are unanimous in emphasizing these rights and sanctities.

The Maliki jurist, Shahab Ad-Deen Al-Qarafi states: The covenant of protection imposes upon us certain obligations toward AhlAdh-Dhimmah. They are our neighbors, under our shelter and protection upon the guarantee of Allah, His Messenger (peace and blessings be upon him) and the religion of Islam. Whoever violates these obligations against anyone of them, by damaging his reputation, or by doing him some injury, has breached the Covenant of Allah, His Messenger, and his conduct run counters to the teachings of Islam. (Al-Furuq, by Al-Qarafi.)

And the Zahiri jurist, IbnHazm, says: If a Dhimmi is threatened by an enemy, it is our obligation to fight the enemy with soldiers and weapons. With this, we will be honoring the Covenant of Allah and His Messenger. To hand him over to the enemy would mean to betrayal to the Covenant of Allah and His Messenger. (MaratibAl-Ijma, by IbnHazm)

Concept of Amicable Dealings with Non-Muslims

now the question arises: How can we show kindness, affection, and good treatment to non-Muslims since Allah the Almighty prohibits Muslims to take non-believers as patrons, allies, and supporters in such verses as the following: (O you who believe, do not take the Jews and Christians as friends; they are the friends (only) of each other. And whoever among you turns to them (for friendship) is certainly one of them; indeed, Allah does not guide the people who do wrong. Yet thou seest those in whose hearts is a disease racing toward them…) (Al-Ma’idah 5: 54-55)

The answer to this is that these verses are not unconditional, to be applied to every Jew, Christian, or non-Muslim. Interpreting them in this manner contradicts the injunctions of the Qur’an which enjoin affection and kindness to the good and peace-loving peoples of every religion, as well as the verses which permit marriage to the women of the People of the Book, with all that Allah says concerning marriage- (…and He has put love and mercy between you…) (Ar-Rum 30: 21) —and the verse concerning the Christians: (…And thou wilt find those who say, ‘Surely we are Christians.’ to be nearest to them (the Muslims) in affection….) (Al-Ma’idah 5: 85)

The verses that imply breaking ties with People of Book refer to those people who were hostile to Islam and waged war against Muslims. Accordingly, it is not permissible for Muslims to support or assist them—that is, to be their ally—nor to entrust them with secrets at the expense of Islam or Muslim community.
this point is explained in other verses, in which Allah Almighty says: (They will spare nothing to ruin you; they yearn for what makes you suffer. Hatred has been expressed by their mouths, but what their hearts conceal is still greater. Thus have We made clear to you the revelations (or signs), if you possess understanding. Ah! You love them, but they do not love you….) (Aal `Imran 3: 118-119) This verse sheds light on the character of such people, who conceal great enmity and hatred against the Muslims in their hearts and whose tongues express some of the effects of such hostility.

Almighty Allah also says: (Thou wilt not find a people who believe in Allah and the Last Day loving those who oppose Allah and His Messenger, even though they may be their fathers or their sons or their brothers or their kin…) (Al-Mujadilah 58: 22)

He Almighty also says: (O you who believe, do not take My enemy and your enemy as friends, offering them affection, even though they have disbelieved in what has come to you of the truth, driving out the Messenger and yourselves because you believe in Allah, your Lord…) (Al-Mumtahinah 60:1)

This verse was revealed in connection with the pagans of Makkah, who declared war against Allah and His Messenger driving the Muslims out of their homes simply because they said, “Our Lord is Allah.” With this type of people, friendship and alliance cannot be permitted. Yet in spite of this, the Qur’an did not dismiss the hope that one day there might be a reconciliation; it did not declare utter disappointment in them but encouraged the Muslims to kindle the hope of better understanding and improved relationships, for in the same surah Allah says: (It may be that Allah will bring about affection between you and those who are your enemies from among them. And Allah is All-Powerful, and Allah is Forgiving, Merciful.) (Al-Mumtahinah 60: 7)

This Qur’anic statement gives the assurance that this bitter hostility and deep hatred is something that may pass way, as it is also stated in the hadith, “Hate your enemy mildly; he may become your friend one day.” (Reported by al-Tirmidhi)

The injunction against befriending enemies of Islam is even more emphatic when they have upper hand over Muslims, crushing hopes and generating fear in the minds of people. In such a situation, only hypocrites and those who are sick at hearts hasten to befriend them, giving them help today in order to benefit from them tomorrow. Almighty Allah describes this situation as follows: (Yet thou seest those in whose hearts is a disease racing toward them (the enemies of Islam), saying, ‘We are afraid that a change of fortune may befall us.’ But it may be that Allah will give (thee) the victory or some decision from Himself, and then they will become regretful for what they thought secretly within themselves.) (Al-Ma’idah 5: 52)

Allah also says: (Give to the hypocrites the tidings that they will have a grievous punishment. Do those who take the unbelievers as friends instead of the Believers seek honor among them? For indeed all honor belongs to Allah alone.) (An-Nisa‘ 4: 138-139)
In the light of the above-mentioned facts, it’s clear that there are certain rules and criteria that govern relationship between Muslims and non-Muslims, and this should be borne in mind when dealing with non-Muslims.

Islam does not order Muslims to show hostility to the followers of other religions, merely for the reason that they happen to be non-Muslims. No. This is not the message of Islam. Only those who harbor hatred and contempt against Muslims are the ones addressed by the verses warning Muslims from taking them as allies. Other than those, Muslims are ordered to deal with all human beings, without discrimination as to race, religion or sex, with love and kindness, for they are all members of the same family of mankind.