Debtor

Abstract: International lending to a less-developed country cannot be based on the debtor's reputation for making repayments. That is, loans to LDCs will no be made or repaid unless foreign creditors have legal or other direct sanctions they can exercise agains a sovereign debtor who defaults. Even if some lending is feasible because of direct sanctions, having a reputation for repayment in no way enhances a small LDC's ability to borrow.

Abstract: International lending to a less-developed country cannot be based on the debtor's reputation for making repayments. That is, loans to LDCs will not be made or repaid unless foreign creditors have legal or other direct sanctions they can exercise against a sovereign debtor who defaults Even if some lending is feasible because of direct sanctions, having a reputation for repayment in no way enhances a small LDC's ability to borrow.

Abstract: List of Boxes and Figures. Foreword. Preface. Acknowledgements. PART I FUNDAMENTALS. 1 Introduction. 1.1 Economic Scenario in the Neoclassical Framework. 1.2 Conventional Debt: A Recipe for Exploitation. 1.3 Growth per se May not Lead to Socio-economic Justice. 1.4 Social Welfare Activities of the States. 1.5 The Main Culprit. 1.6 The Need of the Hour. 1.7 Economics and Religion. 1.8 Islamic Principles Can Make the Difference. 1.9 Regulating Trade and Business. 1.10 Islamic Finance Passing Significant Milestones. 1.11 Could it Work to Achieve the Objectives? 1.12 About this Book. 2 Distinguishing Features of the Islamic Economic System. 2.1 Introduction. 2.2 Islamic Shari'ah and its Objectives. 2.3 Why Study Islamic Economics? 2.4 Islamic Economics: What should it be? 2.5 Paraphernalia of Islamic Economics. 2.6 Summary. 3 The Main Prohibitions and Business Ethics in Islamic Economics and Finance. 3.1 Introduction. 3.2 The Basic Prohibitions. 3.2.1 Prohibition of Riba. 3.3 Business Ethics and Norms. 3.4 Summary and Conclusion. 4 The Philosophy and Features of Islamic Finance. 4.1 Introduction. 4.2 The Philosophy of Islamic Finance. 4.3 Debt versus Equity. 4.4 Islamic Banking: Business versus Benevolence. 4.5 Exchange Rules. 4.6 Time Value of Money in Islamic Finance. 4.7 Money, Monetary Policy and Islamic Finance. 4.8 Summary. PART II CONTRACTUAL BASES IN ISLAMIC FINANCE. 5 Islamic Law of Contracts and Business Transactions. 5.1 Introduction. 5.2 Mal (Wealth), Usufruct and Ownership. 5.2.1 Defining Various Related Terms. 5.3 General Framework of Contracts. 5.4 Elements of a Contract. 5.5 Broad Rules for the Validity of Mu'amalat. 5.6 W'adah (Promise) and Related Matters. 5.7 Types of Contracts. 5.8 Commutative and NonCommutative Contracts. 5.9 Conditional or Contingent Contracts. 5.10 Summary. 6 Trading in Islamic Commercial Law. 6.1 Introduction. 6.2 Bai' - Exchange of Values. 6.3 Legality of Trading. 6.3.1 Trade (Profit) versus Interest: Permissibility versus Prohibition. 6.4 Types of Bai'. 6.5 Requirements of a Valid Sale Contract. 6.6 Riba Involvement in Sales. 6.7 Gharar - A Cause of Prohibition of Sales. 6.8 Conditional Sales and "Two Bargains in One Sale" 6.9 Bai' al'Arbun (Downpayment Sale). 6.10 Bai' al Dayn (Sale of Debt). 6.11 Al 'Inah Sale and the Use of Ruses (Hiyal). 6.12 Options in Sales (Khiyar). 6.13 Summary. 7 Loan and Debt in Islamic Commercial Law. 7.1 Introduction. 7.2 The Terms Defined. 7.3 Illegality of Commercial Interest. 7.4 Loaning and the Banking System. 7.5 Guidance from the Holy Qur'an on Loans and Debts. 7.6 The Substance of Loans. 7.7 Repayment of the Principal Only. 7.8 Time Value of Money in Loans and Debts. 7.9 Instructions for the Debtor. 7.10 Instructions for the Creditor. 7.11 Husnal Qadha (Gracious Payment of Loan/Debt). 7.12 Remitting a Part of a Loan and Prepayment Rebate. 7.13 Penalty on Default. 7.13.1 Insolvency of the Debtor. 7.14 Hawalah (Assignment of Debt). 7.15 Security/Guarantee (Kafalah) in Loans. 7.16 Bai' al Dayn (Sale of Debt/Debt Instruments). 7.17 Impact of Inflation on Loans/Debts. 7.18 Summary. PART III ISLAMIC FINANCE - PRODUCTS AND PROCEDURES. 8 Overview of Financial Institutions and Products: Conventional and Islamic. 8.1 Introduction. 8.2 What is Banking or a Bank? 8.3 The Strategic Position of Banks and Financial Institutions. 8.4 Categories of Conventional Financial Business. 8.5 The Need for Islamic Banks and NBFIs. 8.6 The Issue of Mode Preference. 8.7 Islamic Investment Banking. 8.8 Islamic Financial Markets and Instruments. 8.9 Summary and Conclusion. 9 Murabaha and Musawamah. 9.1 Introduction. 9.2 Conditions of Valid Bai'. 9.3 Murabaha - a Bai' al Amanah. 9.4 Bai' Murabaha in Classical Literature. 9.5 The Need for Murabaha. 9.6 Specific Conditions of Murabaha. 9.6.1 Bai' Murabaha and Credit Sale (Murabaha-Mu'ajjal). 9.7 Possible Structures of Murabaha. 9.8 Murabaha to Purchase Orderer (MPO). 9.9 Issues in Murabaha. 9.10 Precautions in Murabaha Operations. 9.11 Musawamah (Bargaining on Price). 9.12 Summary. 10 Forward Sales: Salam and Istisna'a. 10.1 Introduction. 10.2 Bai' Salam/Salaf. 10.3 Benefits of Salam and the Economic Role of Bai' Salam. 10.4 Features of a Valid Salam Contract. 10.5 Security, Pledge and Liability of the Sureties. 10.6 Disposing of the Goods Purchased on Salam. 10.6.1 Alternatives for Marketing Salam Goods. 10.7 Salam - Post Execution Scenarios. 10.8 Salam-Based Securitization - Salam Certificates/Sukuk. 10.9 Summary of Salam Rules. 10.10 Salam as a Financing Technique by Banks. 10.11 Istisna'a (Order to Manufacture). 11 Ijarah - Leasing 279. 11.1 Introduction. 11.2 Essentials of Ijarah Contracts. 11.3 General Juristic Rules of Ijarah. 11.4 Modern Use of Ijarah. 11.5 Islamic Banks' Ijarah Muntahia-bi-Tamleek. 11.6 Summary of Guidelines for Islamic Bankers on Ijarah. 12 Participatory Modes: Shirkah and its Variants. 12.1 Introduction. 12.2 Legality, Forms and Definition of Partnership. 12.3 Basic Rules of Musharakah. 12.4 The Concept and Rules of Mudarabah. 12.5 Mudarabah Distinguished from Musharakah. 12.6 Modern Corporations: Joint Stock Companies. 12.7 Modern Application of the Concept of Shirkah. 12.8 Diminishing Musharakah. 12.9 Diminishing Musharakah as an Islamic Mode of Finance. 12.10 Summary and Conclusion. 13 Some Accessory Contracts. 13.1 Introduction. 13.2 Wakalah (Agency). 13.3 Tawarruq. 13.4 Ju'alah 13.5 Bai' al Istijrar (Supply Contract). 14 Application of the System: Financing Principles and Practices. 14.1 Introduction. 14.2 Product Development. 14.3 The Nature of Financial Services/Business. 14.4 Prospects and Issues in Specific Areas of Financing. 14.5 Islamic Banks' Relationship with Conventional Banks. 14.6 Fee-based Islamic Banking Services. 14.7 Summary and Conclusion. Appendix: The Major Functions of a Shari'ah Supervisory Board in the Light of the AAOIFI'S Shar ~ i'ah Standard. 15 Sukuk and Securitization: Vital Issues in Islamic Capital Markets. 15.1 Introduction. 15.2 The Capital Market in an Islamic Framework. 15.3 Securitization and Sukuk. 15.4 Summary and Conclusion. 16 Takaful: An Alternative to Conventional Insurance. 16.1 Introduction. 16.2 The Need for Takaful Cover. 16.3 The Shari'ah Basis of Takaful. 16.4 How the Takaful System Works. 16.5 Takaful and Conventional Insurance Compared. 16.6 Status and Potential of the Takaful Industry. 16.7 Takaful Challenges. Appendix: Fatawa (Juristic Opinions) on Different Aspects of Insurance. 17 An Appraisal of Common Criticism of Islamic Banking and Finance. 17.1 Introduction. 17.2 The Common Myths and Objections. 17.3 Appraisal of Conceptual Criticism. 17.4 Appraisal of Criticism on Islamic Banking Practice. 17.5 Conclusion. 18 The Way Forward. 18.1 Introduction. 18.2 Agenda for the Policymakers. 18.3 Potential, Issues and Challenges for Islamic Banking. 18.4 Conclusion. Acronyms. Glossary. References. Arabic/Urdu References. Suggested Further Reading. Index.

Abstract: A new and radical reexamination of today's neoliberalist "new economy" through the political lens of the debtor/creditor relation. "The debtor-creditor relation, which is at the heart of this book, sharpens mechanisms of exploitation and domination indiscriminately, since, in it, there is no distinction between workers and the unemployed, consumers and producers, working and non-working populations, between retirees and welfare recipients. They are all 'debtors,' guilty and responsible in the eyes of capital, which has become the Great, the Universal, Creditor." -from The Making of the Indebted Man Debt-both public debt and private debt-has become a major concern of economic and political leaders. In The Making of the Indebted Man, Maurizio Lazzarato shows that, far from being a threat to the capitalist economy, debt lies at the very core of the neoliberal project. Through a reading of Karl Marx's lesser-known youthful writings on John Mill, and a rereading of writings by Friedrich Nietzsche, Gilles Deleuze, Felix Guattari, and Michel Foucault, Lazzarato demonstrates that debt is above all a political construction, and that the creditor/debtor relation is the fundamental social relation of Western societies. Debt cannot be reduced to a simple economic mechanism, for it is also a technique of "public safety" through which individual and collective subjectivities are governed and controlled. Its aim is to minimize the uncertainty of the time and behavior of the governed. We are forever sinking further into debt to the State, to private insurance, and, on a more general level, to corporations. To insure that we honor our debts, we are at once encouraged and compelled to become the "entrepreneurs" of our lives, of our "human capital." In this way, our entire material, psychological, and affective horizon is upended and reconfigured. How do we extricate ourselves from this impossible situation? How do we escape the neoliberal condition of the indebted man? Lazzarato argues that we will have to recognize that there is no simple technical, economic, or financial solution. We must instead radically challenge the fundamental social relation structuring capitalism: the system of debt.