Finance Minister Urges Changes to NFC Award to Support Long-Term Growth
Pakistan’s Finance Minister Muhammad Aurangzeb said on Saturday that the revenue-sharing formula under the NFC Award needs to be revised, arguing that assigning 82 percent weight to population is limiting long-term development.
Speaking at the regional office of the FPCCI in Lahore, the minister said lower weightages for factors such as poverty, revenue generation, and inverse population density are constraining the country’s economic potential.
He noted that economists have long advocated the inclusion of tax effort, human development indicators, and environmental risk in the formula, but said any reforms would require political consensus.
Highlighting recent economic indicators, Aurangzeb said import cover has improved to 2.5 months and that the government repaid a 500 million dollar Eurobond last year. He added that a further repayment of 1.3 billion dollars is due in April and will be made on schedule.
The minister said that unlike in 2022, when floods compelled Pakistan to seek international assistance, the government did not request aid during recent floods, attributing this to stronger fiscal buffers. He reiterated that the government is focused on export-led growth to avoid past cycles of import-led expansion that depleted foreign reserves and pushed Pakistan back into International Monetary Fund programs.
#PakistanEconomy #NFCAward #FiscalPolicy #ExportLedGrowth #ForeignReserves #IMF #diplomatsWorld
