SBP governor refuses to disclose $3bn loan beneficiaries 'publicly' despite PAC orders

The scheme executed by the PTI govt involves over 600 persons and had zero pc interest rate

ISLAMABAD (Web Desk) – Despite the Public Accounts Committee (PAC)’s earlier directives to involve top agencies for a joint probe into the issue of $3 billion loans to various businesses given by the PTI government, State Bank Governor Jameel Ahmad "showed his reluctance" to provide the details publicaly and insisted on an in-camera meeting.

The development came on Wednesday when the PAC met for the second consecutive day to discuss the multibillion dollar matter that became a debate issue after the removal of the PTI government through the vote of no-confidence last year.

It was on Tuesday that the PAC had directed that the FIA, the NAB, the Auditor General of Pakistan (AGP), and the Military Intelligence (MI) should investigate the scandal and fix the responsibility through a detailed audit.

The PTI government had given this $3bn loan through commercial banks to large textile, cement, tire and auto industries under the refinancing scheme at zero per cent mark-up for 10 years.

During Wednesday’s meeting, the committee members again demanded the list of 620 businessmen, but they were told that the move would breach the confidentiality agreement between the banks and their clients.

But the argument angered the lawmakers who pressed ahead with the call for sharing the names as PAC Chairman Noor Alam Khan reiterated that the inquiry was essential to determine whether any special favours were granted.

However, the central bank governor said the foreign currency wasn’t involved in the scheme which had been revised to a 5pc mark-up rate. The actual amount - Rs394bn - disbursed was in local currency, he added – a claim challenged by the parliamentarians.

Jameel Ahmad also insisted that the government and the SBP didn't do any risk sharing, and commercial banks lent to clients at their own risk. The interest rate was 9pc at the time the scheme was launched which was later reduced to 7pc, he said, adding that the scheme was used only for the purchase of machinery.

At this, some of the members even questioned whether the scheme’s purpose was fulfilled while Senator Salim Mandviwala backed the earlier directives about a forensic audit, including how the funds were utilised.

After a lengthy debate and heated arguments, the PAC agreed to the proposal of the SBP governor and decided to hold an in-camera meeting.