We are young Muslim family who expecting Inshallah one more female baby.
We are thinking of giving the name Asija after Asiya, wife of the Pharaoh.
Are Muslims allowed to give such a name?
Congratulations! MashaAllah that is great news.
Rasulullah narrated in one hadith:
There are many persons amongst men who are quite perfect but there are none perfect amongst women except Mary, daughter of 'Imran, Asiya wife of Pharaoh, and the excellence of 'A'isha as compared to women is that of Tharid over all other foods. (Saheeh Muslim)
As Muslims, we believe that Asiya was one of the best women of all time; it's a great name to name someone with, and to teach them about the one you named them after.
Note the spelling of the name in Arabic, as mentioned in the hadith in Muslim, is آسِيَةَ (alif, seen, yah, ta-marbuwta). There's another hadith in Saheeh Muslim where rasulullah changed the name of a woman from 'asiyah to jameelah.
Note the spelling difference: in the latter hadith, the name is spelt عَاصِيَةَ (ayn, alif, saad, yah, ta-marbuwtah). This name is from the root word ayn-saad-alif, which means to disobey, and is mentioned plenty of times in the Qur'an.
Given that the latter name uses letters that are harder to pronounce (ayn and saad), you would need to intentionally pronounce the name differently to use the unfortunate meaning. It won't be a problem inshaAllah.