Mixed-methods analysis reveals disparities in regional development and ongoing fiscal imbalances, indicating political influences in Pakistan's federal structure.
This study examines the intricate dynamics of Pakistan's fiscal federalism, with particular emphasis on center–province disputes and their effects on regional economic inequality. Despite constitutional pledges to decentralize especially following the 7th National Finance Commission (NFC) Award and the 18th Constitutional Amendment Pakistan continues to exhibit both vertical and horizontal fiscal imbalances. Using a mixed-methods approach, the study analyzes both primary and secondary data from federal and provincial budgets, institutional reports, and economic surveys. Descriptive statistical analysis indicates that the federal government continues to control the majority of revenue collection, while provinces remain heavily dependent on federal transfers. Comparative research reveals notable disparities in per capita development spending, particularly among emerging regions and their federating units, such as Khyber Pakhtunkhwa and Balochistan. The study concludes that Pakistan's fiscal federalism is not merely a financial arrangement but a deeply political process, shaped by power dynamics, institutional frameworks, and historical inequalities.
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Aryani et al. (2025) studied this question.
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