Pakistan reslices revenue pie: formula for unity?
The government resolved a two-decade conflict over how to share the nation’s revenue. Redistributing wealth – even by a few percentage points – is a first step toward easing the hostilities that have fueled bloody insurgencies and stalled important energy projects.
The technocratic title sounds nothing like a historic agreement.Skip to next paragraph
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But the 7th National Finance Commission Award that Pakistani federal and provincial government officials hashed out this month resolves a two-decade conflict over how to share the nation’s revenue.
By redistributing wealth – even by just a few percentage points – it marks a first step toward easing the hostilities that have fueled bloody insurgencies and stalled important energy projects.
Not bad for a country in perpetual fear of breaking into its four ethnically divided provinces.
“If you are able to get across this feeling that you are getting your due share, this obviously will help in terms of national unity,” says Kemal Siddiqi, Karachi-based editor of the Express Tribune, a Pakistani newspaper. “The next challenge could be … getting them to use that money so there’s a visible change.”
Deal could build goodwill
The deal came about after months of meetings and three days of final negotiations in Lahore that ended on Dec. 11. The federal government agreed to distribute more of the overall pot to the provinces, and dominant Punjab Province agreed to share more money with the other three (it gave up 1.27 percent and will keep 51.74 percent).
“It’s not a small achievement,” says Abida Hussain, a senior member of the ruling Pakistan People’s Party, who calls the NFC deal one of the government’s greatest accomplishments so far. “The real underlying problems [of the country] are the problems between the provinces.”
Pakistan is not about to splinter into pieces, but it has always faced separatist movements – a threat made real in 1971, when East Pakistan broke away to became Bangladesh.
Decades of clashes between armed insurgents in southwestern Baluchistan Province and the Army have killed thousands. Residents of this vast region, which is poorly developed but full of natural resources, accuse Islamabad of piping out their oil and gas but not giving enough in return, and of building a free-trade zone in Gwadar but not giving jobs to locals. The province will see its portion of funds grow from 7.17 percent to 9.09 percent.