In layman language its a pressure tactic to convert people, isnt it? The same capatilist democratic country you are living in, someday can legislate to become an similar ideological country based on their xyz religion and implement system similar to Khilafat system. Would you ok with that?
The golden rule (that what you apply on others should accepted vice versa) should apply , isnt it?
Sure, let's say it is (that the Khilafat wants people to become Muslim)... From the view of the Khilafah, it views its ideology as the correct ideology and that it spreading it is not for the sake of domination, but saving people from hellfire.
I am not going to sugar coat it, spreading Islam is the overarching foreign policy constant of the Khilafah. That's the reality of ideological states: When the U.S goes to war in Iraq or Afghanistan, it's there to preserve and strengthen its core ideological interests, i.e. capitalism (if not abroad, then definitely at home). Of course in the case of Khilafah, it isn't there to secure resources for the benefit of an entitled few, but rather, ensure that all people receive their entitled due.
Also, the Khilafat isn't in the business of fighting civilians or destroying property (*cough* U.S *cough*), but merely fighting enemy armies on the battlefield to the extent that Islam can flow.
In other words, collateral damage, harming individual people, etc, is categorically impermissible, regardless of the circumstances. The second Caliph, Umar ibn al-Khattab (RA), was assassinated by a disgruntled Persian, yet the Muslims did not put Persians under profiling or added oppression. In fact, the person the Muslims had a problem with was the son of Umar (RA)'s predecessor, who killed a suspect, which is not permitted in Islam! They even held a tribunal to determine if the person ought to be executed!
That said, while a democracy can legislate laws on a whim (i.e. one day tell me to abandon Islam entirely), the Khilafat system's laws and values are inalienable. In other words, when Allah (swt) says, "there is no compulsion in faith" - then that's end of story, neither the Imam or the Muslims could force non-Muslims to become Muslims, no matter what their wishes or whims.
Yes, one would have to be a Muslim in order to become a politically relevant figure (though non-Muslims are encouraged to participate in order to secure their rights, as non-Muslims), just as I would need to abandon Islam on matters of public affairs in order to be a relevant figure in the West. How can a system survive when its actors hold conflicting thoughts?
Of course the system would reject those that are not in alignment, that's not a moral PoV, it's a reality. Can I participate in the Western democratic system now and say women have no right to own property? Nope. On the same note, a person saying women can't own anything would be rejected by the Islamic system as well.
To put it simply, a non-Muslim individual wanting to live their life in the sense of attaining a comfortable socio-economic status (e.g. job, property, etc) could do so as much as a Muslim. Moreover, a non-Muslim can also manage their personal relationships (e.g. marriage, or not...pork, or not... etc) according to their own beliefs. No one, under any circumstance, can take that away from you...and if they do, they're oppressors.