The Government of Sindh today reaffirmed its unwavering commitment to protecting the constitutional rights and fiscal share of the province in the upcoming National Finance Commission (NFC) deliberations. This comes at a decisive moment for Pakistan’s economic governance, with the IMF’s latest Governance and Corruption Diagnostic Report (2025) underscoring critical weaknesses in federal fiscal transparency, state capacity, and institutional performance.
‘The NFC Award is not merely a mechanism for distributing financial resources – it is a constitutional guarantee of fairness, equity, and balanced development across all provinces,’ said Government of Sindh Spokesperson Sukhdev Hemnani in a statement issued today.
Hemnani noted that the last NFC Award was finalized before the abolition of the concurrent legislative list. ‘After the 18th Amendment, provinces shoulder significantly expanded responsibilities in health, education, social protection, and key service-delivery sectors. Any suggestion of reducing provincial shares contradicts both the constitutional design and the practical needs of governance,’ he said.
He added that the recurring narrative promoted by certain quarters – that the federal government is ‘left with nothing’ after transferring resources to the provinces – is factually incorrect and economically misguided. ‘The issue is not the provincial share, which rightfully returns to the federating units from where taxes are collected. The real problem lies in chronic governance failures: loss-making state-owned enterprises, persistent tax evasion, smuggling, irrational elite subsidies, and weak institutional oversight,’ Hemnani stated.
He recalled that under the last fiscal arrangements it was agreed that the FBR’s tax-to-GDP ratio would be raised to 15%, yet this target remains unrealized even today. ‘Pakistan loses more than 5-6% of GDP annually to tax evasion and smuggling, and a similar amount is lost to governance lapses, mismanagement, and distortive subsidies. These structural failures – not provincial shares – are the true source of the fiscal strain Pakistan faces. The national conversation must focus on root causes rather than deflecting blame onto the provinces,’ he stressed.
Hemnani reiterated that fiscal federalism must continue to evolve in order to deliver equity. ‘The NFC’s multi-criteria formula remains essential for addressing regional disparities. Any departure from these principles – particularly in a climate where the IMF has highlighted risks of state capture – would undermine the constitutional foundation of cooperative federalism.’
He added that Sindh’s position is grounded in both constitutional clarity and economic logic: strong provinces create a stronger federation. ‘Sindh will present its proposals clearly and firmly. Our focus is fiscal justice, provincial autonomy, and transparent governance aligned with the constitutional vision.’
‘The Government of Sindh remains committed to constructive engagement in the upcoming NFC meeting. We will fully safeguard provincial rights while working cooperatively to strengthen Pakistan’s overall fiscal architecture,’ Hemnani underscored.