World Bank Help For Pakistan’s Education – A Poisoned Chalice?

Re: # 46 no w chaltahai can you explain this to our islamic radical, rihat is some plain and simple terms/lanaguge. Maybe you should arby language since that is what he understands (T)

MAJ you model below is silly...the loan is secured by assets and otehr collateral, equity capital is not. the risk premium on equity investments is higher and thus...giving the lender equitable return to that of an equity holder's dividend is stupid. if the company goes bankrupt, the loan holder is first up. but he has secured his principal based on the asset value of the collateral. Equity holder may get nothing.....so if the ROI is 20% for the company, the disbursement, whether a flat rate per your model to the lender or the dividends back to teh equity holders cannot be at par. the liability i.e. the loan will drive down the equity value of the company.

Now non-practising green-card holder Hindus will teach us how to bank.

Your collective gift to mankind is the unkind usurer 'banya'.

Re: # 28
'If the islamists think there is a free lunch available, and that this "interest free thing" is really interet free they are living in cloud cuckoo land.'

The Qur'an is precise in stating that 'usurers are touched by satan' because these (businessmen in suits) insist that 'trading is similar to usury, whereas Allah has permitted (legitimate/halal) business but not the multiplication of wealth through usury', this creation of fiat money.

Wake up before all your hopes are dashed.

Re: # 27
'Almost every bank in Pakistan has now seperate section of Islamic Riba-Free Banking.'

The same bank that fleeces us through usury cannot--on any moral ground--open up a section that promises 'riba-free' banking. It is like mixing a drop of urine with clean water meant for ablution and insisting that it is still ritually clean (unless one is Morarjee Desai)!

Down with the financiers of global instability and misery.

PS: I hope you're not a banker.

Re: # 23
'It would be a good idea if Pakistan could become a truly Islamic state and implement ideas such as riba free banking.'

We're working on it, now only if Laddu and his ilk would leave us alone.

:)

Re: # 16

This is rich. Third world countries create wealth and the western world just generates interest.

Speak of grandiose delusions.

Very true, Pervez sahib, but where do we go from here is the question. For how long the education sector will remain a neglected area on our governments' priority list? Will we ever learn the right lessons???

Pervez...
I support your view...But WB mostly provides loan to improve literacy rate and in primary education. In India,the SSA( Sarva Siksha Aviyaan) is partly sponsored by WB and partly from education cess collected from income tax. I don't think world bank will invest money on luxury item like higher education....

Sunil babu,

MAJ is probably 500years behind time when expenditure on armaments,queens necklace and kings, luxurious palace were only considered productive

I am trying to understand the Islamic viewpoint. I have taken loads of interest bearing loans- for all kinds of "unproductive" reasons.

Regards

#36 Cars/housing non productive? In modern economy all such assets are considered productive as these give rise to production and consumption of so many other materials like cement ,steel,and host other civil,electromech materials.MAJ is probably 500years behind time when expenditure on armaments,queens necklace and kings, luxurious palace were only considered productive

Nkg moshai,

Good question. Maybe one solution wud be to restrict loans to productive assets and not to cars/housing.

Beej bhayya,

If my understanding is correct, paying more than face value alone does not result in "interest" rather it is paying a fixed coupon, not profit sharing.

Hopefully, some experts like Zee sb or Tahir mian or kadvimeethi will shed some light.

Regards

MAJ, there is no way for money to "grow" unless somebody is paying more for it (in whatever form) than its face value. An interest by any other name is still interest.

Re: # 32
MAJ...
That way how you manage housing or car loan? You create asset, which might depreciate with time (specifically car)...and when you sell it after 4/5 years, if you share the selling cost, you are going to loose anyway...
Can people borrow car loan from Islamic Banks?

Re: # 30
dash...
".. indian rope trick..."
Who have invented that concept?
http://in.youtube.com/watch?v=x_cJ8FwBdaI

Dash babu,

If hard core Muslims are OK with profit sharing, so be it.

Regards