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more backward provinces, Khyber Pakhtunkhwa and Baluchistan, as compared to Sindh and Punjab. Before this award, provinces were getting Rs.550 billion. But in the first year of enforcement of this award provinces got more than Rs.850 billion, and in the next 5 years this amount will increase up to 1250 billion. The greatest achievement of this award is the reduction in inequalities regarding revenue collection in Sindh and Punjab, gas development surcharge from Baluchistan, and hydel profits from KPK. Considering the role of Khyber Pakhtun Khwa in war against terrorism, it has been provided a share of 1 percent from the divisible pool.

 

2. DEVELOPMENT OF NFC AWARDS OVER TIME

 

Financial resources play the fundamental role in the development of any country. A well thought-out resource distribution is necessary for the development of backward areas so they can be at par with the national growth and progress. The current state of revenue distribution in Pakistan has evolved over time. Various improvements and advancements have been made in the revenue sharing formula since the formation of National Finance Commission. In this section I will analyze the impact of various NFC awards on the fiscal decentralization of the country.

 

In Pakistan fiscal federalism has always been an issue which has never received a serious approach. Out of Seven NFC awards, only four have come up with additional parameters of revenue sharing between the federation and its units. Federal government has taken a less systematic approach to decentralize fiscal powers and functions and made the provinces depend on the center. This has negatively affected the performance and efficiency of provinces to work effectively. In a federation, the basic functions of Central government are maintaining law and order, defense matters, making a sound foreign policy, communications, currency management, general administration, debt servicing, industrial development, and work on public welfare including health and education. The rest of the matters fall within the sphere of Provincial and local governments. But not much effort has been put by our politicians to devolve powers and functions to lower tiers of government.

 

With the passage of time, federal government has over-stretched itself into such matters which are of purely provincial nature, like irrigation, construction of roads, agricultural development, culture and tourism, youth affairs, and rural development. This has increased financial and administrative burden on the center. Federal government has taken too much responsibilities on its shoulders which certainly require more finance. If government is aiming toward devolution of power from center to provincial and local level, these tiers of government must be empowered and enabled to generate their own finance. Federal government generates 93 percent of the resources, while its share in the total expenditure makes up only 72 percent. On the other side, the total expenditure of provinces is 28 percent, and they generate merely 7 percent of the resourc本论文由英语论文网提供整理，提供论文代写，英语论文代写，代写论文，代写英语论文，代写留学生论文，代写英文论文，留学生论文代写相关核心关键词搜索。