[Sharing an interesting article by Joseph Islam relating to the issue being discussed]
PEOPLE OF THE BOOK (JEWS & CHRISTIANS)
The following article will attempt to impart clear directives from the Quran with regards the People of the Book (Arabic: Ahl-e-Kitab). Some verses may prove to be a surprise for many Muslims that have mainly relied on a theology absorbed from Islamic secondary sources. For all intent and purposes, nothing can change God's words and a true believer would be expected to submit to God's commands.
The Quran asks the People of the Book to recognise that what has come to the final prophet is the truth which is confirming the truth which is also with them.
God's message of truth has always been the same. Believe in One God of the Universe, believe in the unseen hereafter, associate no partners with God and to do righteous deeds.
Verses dealing with fighting Christians and Jews deal with a specific people who broke treaties, committed evil etc. They cannot be applied to all Christians and Jews for all times. Please see related articles  and .
Non-Muslims are not always Kaafir (Disbelievers) and the Quran does not refer to Jews and Christians as disbelievers but as 'Ahl-e-Kitab' (People of the Book). Even idolaters are not necessarily 'Kaffirs'. Please see related article .
Jews and Christians can be Muslims. Please see related article .
There are also 'believers' amongst the People of the Book. Please see related article .
The Quran does not demand the Jews and Christians to 'convert' or abandon their laws. Until the People of the Book are convinced of the veracity of the message of the Quran, the people of the Book must follow the laws of their own scriptures in truth as Muslims and God will judge them equitably.
It is not unusual to find an element of 'exclusivity' in many (if not all) world religions. Where other religions may be 'tolerated', there is often a tacit belief amongst the followers of various sects of world faiths that their particular 'thought' or 'belief system' is the only correct path to enlightenment and therefore open to God's salvation. This line of thinking is no different for a number of Muslims.
Many Muslims do ask the question:
How is it possible that righteous Christians and Jews that spend all their life's endeavours in pursuit of good acts but do not believe in the veracity of the final message, are simply destined for hell? Especially when, we know God will not allow an atom's weight of injustice?
Another popular question is often asked:
"What is the state of salvation for individuals who reside in the most obscure, remote places of the world, such as jungles and high mountains, to whom the clarity of God's scriptures has not reached and who put their faith in obscure deities? Why will they simply be punished for their circumstances when other's have access to a much clearer message?"
Both are common yet pertinent questions. Though many attempts are made to source plausible explanations, most often than not, they are not always very convincing.
For Muslim readers, it will be significant to note that the verses cited below from the Quran were being revealed to Prophet Muhammad (pbuh) in possibly the late 6th, early 7th century. Many Muslims place complete distrust in the Gospels and Torah, due to their belief that the Bible is beyond salvation of the truth. This view seems to be unwarranted from a Quran's perspective.
Fellow Muslim readers would be advised to note that at the point of revelation to Prophet Muhammad, (pbuh) the Torah and particularly the Gospels had already undergone canonisation, the council of Nicaea had already convened in 325 AD under Constantine (nearly 300 years earlier), some Gospels had already been assigned an Apocrypha status and the Jewish Tanakh and Talmud had already been canonized as well as the orthodox Gospels.