Can one achieve directory permissions on Android? On any android device 99.5% of the apps want the permission "Write / Read contents of SD card" in a combination with "Full network access".

Theoretically these 2 permissions are enough for the app to read all of my personal files (cloud storage) and send them to their server. Is there a way to only permit apps access to their folders? 

Why do all apps have access to all folders? Why is such a basic concept not implemented?
Folder level permissions are not a good choice for sdcard (whether it is emulated or external). It makes things more complicated. 

By default, sdcards are mounted noexec, no binaries are able to execute from sdcard. Needless to mention, many external sdcards at the moment are formatted with fat32, permissions arent an option for them.

Every app has their own uid/gid. If an app has to have exclusive read/write permissions (preventing other apps to read that content) onto a folder on sdcard, then chances are that the folder is inaccessible to other apps. This kind of situation breaks things.

For eg, Music files go under Music folder on sdcard. If that folder has exclusive permissions to only a particular music app, then U cannot have multiple music players on your device.

Another example is a third party file manager cannot even access all the content on sdcard, which makes file manager pointless.

If at all such concept is available, chances are that android/google enforces sorting of files/folders on our sdcards. I wouldn't prefer that. I would rather like to have files/folders sorted the way I prefer, not the way someone enforces me to.