ISLAMABAD: The State Bank will provide updated lists of loan defaulters to the Election Commission of Pakistan on Monday for scrutiny of nomination papers of candidates for the coming election.

SBP Governor Yaseen Anwar informed the Senate Standing Committee on Finance on Thursday that all banks had been asked to provide updated Credit Information Bureau reports which would be forwarded to the ECP.

Senior management of the central bank also informed the committee headed by Senator Nasrin Jalil of the MQM that the government had failed to comply with the Fiscal Responsibility and Debt Limitation Act and the SBP Act on curtailing borrowing that could lead the country into a debt trap.

But the committee was assured that the SBP had all the resources to honour the international debt obligations, including those with the International Monetary Fund, until June 30.

Replying to questions, the SBP chief said the loans defaulted or restructured because of natural calamities and economic recession would not be treated as default and the names of their borrowers would not be included in the list.

The SBP governor said the government had time and again announced incentives for retiring loans after natural disasters and those availing themselves of such schemes through restructuring and repayment could not be classified as defaulters.

On the question of defaults owing to economic recession, he said the SBP had given liberty to commercial banks to restructure such loans in view of the prevailing conditions for recovery of outstanding amounts. Those who were able to get their loans restructured and make payments will also not be treated as defaulters. He said no-objection certificates from banks would not be required because the ECP would have all the updated data from SBP’s credit information reports.

Mr Anwar said the entire record of loan defaulters from 1999 to 2004 was with the Supreme Court which regularly acquired information from the SBP about those cases.

One of his aides said the court wanted the banks to recover the loans at all cost, instead of offering incentive schemes. He said a judicial commission headed by Justice Syed Jamshed Ali Shah had submitted a 27-volume report on defaulters to the court and the SBP was trying to get its copy.

ECONOMIC SITUATION: The SBP informed the committee that political and economic uncertainties were posing many challenges but all international obligations, including $398 million repayment to the IMF, would be honoured without any problem.

It conceded that annual targets for inflation, government borrowing and fiscal deficit had been exceeded throughout the past five years because of external factors and lower tax collections and higher expenditures than planned, which in the long term could plunge the country into a debt trap.