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DEFINITION OF MUDHARABAH A Mudharabah transaction is derived from a partnership based on risk and profit sharing. This partnership is a collaboration between an investor (Rabbul Mal) and an entrepreneur (Mudharib) under which the former provides funds to the latter for the purpose of investment and profit sharing. This is how it works in practice - you, the investor will deposit an amount of money with the bank, which acts as the entrepreneur. This investment is utilised as business capital by the bank. In this contract we have no authority to interfere in the management of our investment. On the other hand, the bank will have the right to manage our investments as it thinks fit by placing it into businesses that are permissible in…show more content…
Using the large coal deposits from nearby coal-fields in the Mukah-Balingian region, the Mukah power plant will be the third coal-fired power plant in Sarawak, after the up-and-running 110 MW Sejingkat Power Plant (phase 2). The Sejingkat Power Plant is located on the outskirts of Kuching and is 100% owned by SECB and SESCO. Upon completion, the Mukah power plant will be the largest power plant in the State, and it is expected to provide approximately15% of Sarawak’s power needs. MPG and SPG senior officials today signed financing agreements with RHB ISLAMIC, formalising the issuances of up to RM950 million Sukuk Mudharabah and up to RM215 million Sukuk Musyarakah for the Mukah Power Plant project, by MPG and SPG respectively. The two Sukuk programmes, structured along the true blue Syariah principles of Mudharabah and Musyarakah, the Middle East syariah standards in Islamic financing. The Sukuk programmes, which provide an almost 100% financing to the Mukah power project, with a paid-up capital of RM2 million, would be fully acceptable to the Middle East market. The signing ceremony was witnessed by the YAB Pehin Sri Haji Abdul Taib Mahmud, the Chief Minister of Sarawak. Proceeds from the RM950 million Sukuk Mudharabah issuance will be utilised to part repay shareholder’s advances and part finance project
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