Provincial Autonomy
The institutional mechanism has been strengthened to establish good relationship between the
Federal Government and the Federating Units. The subjects in the FLL-II have been increased.
Role of the Provinces in the decision-making concerning federation has been increased. Some
subjects of the FLL-I have also been removed. These are good steps for ensuring the provincial
autonomy (Tahir, 2012). The NFC and the CCI will play key role in resolution of the conflicts
regarding devolved subjects of the CLL (Sultana, 2012).
The Fourth Schedule
Prior to the18th Amendment, there were two lists in the Fourth Schedule of the 1973
Constitution, namely the FLL (Part- I, and Part- II) and the CLL. After the18th Amendment, the
CLL has been removed. The Parliament and the Provincial Assembly can make laws regarding
criminal law, criminal procedure and evidence. The Provincial Assembly shall and the
Parliament shall not have powers to make laws concerning any matter not included in the FLL.
The Parliament shall have powers to make laws regarding any areas that are not included in any
Province (Constitution of the Islamic Republic of Pakistan 1973, Fourth Schedule).
Four items; national economic coordination and national planning, census, major ports
and extension of powers and authority of Provincial police force to railway and other Provinces
have been transferred from Part-I of the FLL to Part-II (shared responsibility). The items in the
CLL have been delegated to the Provinces. One item (Boiler) has been shifted to the FLL-1. Two
items, medical, legal and other professions and electricity have been shifted toFLL-11
(Constitution of the Islamic Republic of Pakistan 1973, Fourth Schedule).
Five items have been removed from the FLLPart-1 and transferred to the Provinces;
capital gains, duties concerning succession of property, general sales tax on services, state
lotteries and estate duty regarding property (Constitution of the Islamic Republic of Pakistan
1973, Fourth Schedule). Now, it is responsibility of the Provinces to get advantage from this
opportunity. A new item (international arbitration, international agreements, treaties and
conventions) has been added to the FLL Part-1. Five new items have been added to the FLL Part-
11 (Constitution of the Islamic Republic of Pakistan 1973, Fourth Schedule).
Electricity
Before the18th Amendment, electricity was item 34 in the CLL and was administered
through the CCI. After deletion of the CLL, electricity has been transferred to the FLL Part-II.
Article 157 has been amended in two aspects. Firstly, the Federal Government shall consult the
concerned Provincial Government before construction of hydro-electric power station in that
Province. Secondly, if any dispute arises between the Federal Government and the Provincial
Government and, the issue shall be solved by the CCI (Constitution of the Islamic Republic of
Pakistan 1973, Article 157). It is significant to note that the provincial authority has been duly
recognized.
Natural Gas and Hydroelectric Power
According tothe18th Amendment, a new clause (B) has been included in the Article 161.The
section (B) states that,
“the net proceeds of the federal duty of excise on oil levied at well-head and
collected by the Federal Government, shall not form part of the Federal
Consolidated Fund and shall be paid to the Province in which the well-head of oil is
located” (Constitution of the Islamic Republic of Pakistan 1973, Article 161).
Borrowing of Loans
Prior to the18th Amendment, the Article 167 addressed borrowing of the loans. The
amendment inserted a new section (4) in the Article 167. The Provinces can now raise domestic
as well as international loans. Previously the provinces had made many requests to empower
them in this regard (Constitution of the Islamic Republic of Pakistan 1973, Article 167).
Ownership
In the past, ownership of natural resources and its revenue was an important cause of
conflict between the Federal Government and, specially, the small provinces. Prior to the 18th
Amendment, the originated Province was paid federal excise on natural gas. However, it was
not given on oil (Tahir, 2012). Amendment has been made in the Article 161 (1). It says:
“(a) the net proceeds of the Federal duty of excise on natural gas levied at well head
and collected by the Federal Government, shall not form part of the Federal
Consolidated Fund and shall be paid to the Province in which the well-head of natural
gas is situated;
(b) the net proceeds of the Federal duty of excise on oil levied at well-head and
collected by the Federal Government, shall not form part of the Federal Consolidated
Fund and shall be paid to the Province in which the well-head of oil gas is situated”
(Constitution of the Islamic Republic of Pakistan 1973, Article 161-1).
The Article 172 addresses the ownership. According to the18th Amendment, a new
section (3) has been inserted. It states that the natural gas and mineral oil within the boundary of
the Province or the territorial waters in its adjacent area shall vest commonly and equally in that
Province and the Federal Government (Constitution of the Islamic Republic of Pakistan 1973,
Article 172).
Provincial Assemblies
After the 18th Amendment, the Presidential discretionary powers to dissolve the National
Assembly have been removed. After deletion of the paragraph (B) of clause 2 of the Article 112,
the Governor cannot dissolve the Provincial Assembly by using his discretionary powers. The
CLL has been abolished and the provincial responsibilities have been increased. An amendment
has been made in the Article 127. The working days for the Provincial Assembly have been
increased from 70 to 100 (Constitution of the Islamic Republic of Pakistan 1973, Article 127-G).
The Article 128 has also been amended. The Provincial Assembly can extend the Ordinance by
passing a resolution. The extension can be given only once (Constitution of the Islamic Republic
of Pakistan 1973, Article 128).
After the 18th Amendment, the legislative and administrative powers of the provinces
have been increased. The CLL has been removed from the Constitution. The provinces have
greater control over the natural resource as compare to the past. Powers of the CCI and the
Senate have been enhanced. After the18th Amendment, it is difficult for the President to
proclaim the emergency in a province. The amendment has ensured that the Governor of a
province must be resident of that province. After the 18th Amendment, more subjects had come
under jurisdiction of the provinces.
Fiscal Federalism
The NFC
The core objective of the NFC is to distribute resources between the Federal Government
and the federating units. In 1996, the fifth NFC Award was given. The sixth NFC Award was
instituted in 2000. However, it could not announce the award and its period expired in July,
2000. In July, 2005, the seventh NFC Award was established and announced in
2010. The new Award was announced after a long period of fourteen years (H. Khan, 2012).
According to the18th Amendment, two new Sections 3 (A) and 3(B) have been added in
Article 160. According to the Clause 3 (A), the share of the Province shall not be less than the
share allocated to the Provinces in the former Award. Clause 3 (B) assigns duty to the Federal
Finance Minister and the Provincial Finance Ministers to look after the affairs of the Award and
present their reports before the National Assembly, the Senate and the Provincial Assemblies
twice a year (Constitution of the Islamic Republic of Pakistan 1973, Article 160).
The 7th NFC Award
The signing ceremony was held at Gwader (Balochistan). The Chief Ministers of the four
Provinces signed on the historic Accord on December 30, 2009. The Prime Minister Yousaf
Raza Gillani was also present at that occasion. The Award was enforced on July 1, 2010 (Burki,
2010). The 7th NFC Award was an important step towards fiscal federalism. A consensus was
made by the political leadership for distribution of resources. In the past, population was the key
factor for distribution of resources among the provinces. The share of the provinces in the federal
divisible pool has been raised from 47.5% to 57.5%, an important increase of 10%. According to
the 7th NFC Award, poverty, revenue generation and population are given importance for
distribution of resources. Khyber Pukhtunkhwa (KPK) is the most affected province of Pakistan
in “war on terror”. An additional 1% was kept for the province for this purpose. Unanimity was
also made by the center upon arrears of KPK on net hydel profits and Balochistan on gas
development surcharge. According to the Article 160 of the Constitution, the provincial share
cannot be reduced in the future NFC agreement as given in the 7th NFC Award. It is an
important step taken for fiscal federalism (Ahmad, 2010).
Table: Revenue Sharing Formula among the Provinces
Tax Sharing Criteria Weight
NFC 1991 Divisible Taxes Population 100%
NFC 1996 Divisible Taxes Population 100%
Presidential Order 2006 Divisible Taxes Population 100%
NFC 2009 Divisible Taxes Population 83%
Poverty 10.3%
Revenue 5%
IPD 2.7%
(Inverse Population Density)
Source: State of the Economy: Devolution in Pakistan available at http://ippbnu.org/AR/4AR.pdf., 110.
Table: Provincial Shares in different Awards from Divisible Pool
Province NFC NFC Presidential Order NFC
1991 1996 2006 2009
Punjab 57.87 57.37 57.37 51.74
(57.87) (57.87) (57.36) (57.36)
Sindh 23.29 23.29 23.71 24.55
(23.29) (23.29) (23.71) (23.71)
KPK 13.54 13.54 13.82 24.55
(13.54) (13.54) (13.82) (13.82)
Balochistan 5.30 5.30 5.11 9.9
(5.30) (5.30) (5.11) (5.11)
Total 100 100 100 100
Source: Source: State of the Economy: Devolution in Pakistan available at
http://ippbnu.org/AR/4AR.pdf., 110.
Note: Figures in brackets show population of provinces according to the census conducted before the
Award.
Under the 18th Amendment, change in a big quantum has been made in the Fourth
Schedule of the 1973 Constitution. The Federal Government has absolute control on the subjects
included in the FLL-I. Prior to the amendment, there were 59 subjects in the FLL-I. After the
amendment, there are 53 subjects in the FLL-I with four revisions of four sub-entries. Four
subjects “economic and scientific research coordination, census, national planning and major
ports” have been shifted to FLL-II. The subjects included in the FLL-II lie under the jurisdiction
of the Federal Government. However, the Federal Government and the Provincial Governments
perform joint responsibility on the subjects included in the FLL-II, through the CCI. Prior to the
18th Amendment, there were eight subjects in the FLL-II. After the amendment, there are
eighteen subjects in the FLL-II. Role of the federating units has been enhanced in the decision-
making at federal level (Tahir, 2012).
Both the Federal Government and the Provincial Governments had joint jurisdiction on
47 subjects, included in the CLL. Under the 18th Amendment, the CLL has been removed from
the Constitution. Subject (29), boilers, has been moved to FLL-I. Two subjects, (34) electricity
and (43) medical, legal and other professions have been moved to FLL-II. The residual subjects
fall under realm of the provinces. According to the Article 142 (C), the provinces have absolute
jurisdiction to legislate on subjects that are not included in the FLL (Tahir, 2012).
Relationship between the Federal Government and the
Provinces
Prior to the 18th Amendment, the Federal Government and the Provinces enjoyed
concurrent functions. The core matters of the CLL were natural resources, electricity and
regulatory functions. The concurrent list is abolished in the 18th Amendment. Functions of the
federal government have been reexamined (Anwar Shah, 2012). The 18th Constitutional
Amendment brought significant changes in the relationships between the Federal Government
and the Provincial Governments. The provincial representation has been reinforced through the
CCI and the NEC. The CLL has been deleted.
The CCI
The CCI was established first time in the 1956 Constitution. The Prime Minister was the
head of the council. There was equal representation of the Federal Government and the
Provincial Governments in the CCI. The council had authority over the FLL and the electricity.
Its meetings were not held regularly. The Federal Government did not want to strengthen the
CCI (Anwar Shah, 2012).
An attempt has been made to strengthen the CCI through the 18th Constitutional
Amendment. All issues concerning the federation are discussed in the council. The Prime
Minister is to be chaired the CCI. It consists of the four Chief Ministers and three members
nominated by the Federal Government. It is obligatory for the council to meet at least once every
quarter. The council has been given the power concerning supervision, decision making,
monitoring and control over the FLL-II. It contains the following:
“conflict resolution; norms in education and research; regulation of the medical,
legal and other professions; regulation of public debts; provincial police powers
beyond provincial boundaries; census; federal regulatory authorities; fiscal
coordination and national planning; industrial policy; electricity; railways;
minerals, oil and natural gas; harmful materials and major ports” (Anwar Shah,
2012).
National Economic Council
The National Economic Council (NEC) was established under the constitution. The Prime
Minister was head of the council. In the past, the President could nominate its members. It was
compulsory that at least one member must be nominated from each province. The composition of
the council has been revised under the 18th Constitutional Amendment. There are two members
including the Chief Ministers from each province and four members from Federal Government,
appointed by the Prime Minister. The provinces are more powerful as compare to the past. The
council has to meet after every six months. According to the Article 156 (5), the council will
have to submit its annual report to both houses of the Parliament (Constitution of the Islamic
Republic of Pakistan 1973, Article 156). The NEC has been shifted from FLL-I to
FLL-II. Now, the subject of national planning is performed jointly by the Federal Government
and the Provinces (Constitution of the Islamic Republic of Pakistan 1973, Fourth Schedule,
FLL-II, Entry 7).
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Consociational federalism
Consociational federalism is a political system characterized by power-sharing arrangements
among different ethnic, religious, or cultural groups within a federal structure. This concept is
rooted in the broader idea of consociationalism, which emphasizes inclusive decision-making
processes to accommodate diverse social groups in divided societies. In consociational
federalism, the central government shares powers with regional or state governments, and
mechanisms are put in place to ensure the representation and participation of various
communities.
Key features of consociational federalism may include:
1. Grand Coalition: The major political parties or ethnic groups form a grand coalition, ensuring
that different segments of the population have a role in the government.
2. Proportional Representation: Representation is often based on proportional allocation,
ensuring that minority groups have a share in legislative and executive bodies.
3. Cultural Autonomy: Regions or states within the federal structure may have a degree of
autonomy in cultural, educational, or administrative matters to preserve and promote their
distinct identity.
4. Power-Sharing Institutions: Special institutions or power-sharing mechanisms may be
established to mediate conflicts and facilitate cooperation among diverse groups.
5. Mutual Veto: In some cases, consociational federalism involves a mutual veto power, where
significant decisions require the agreement of all major communities.
The consociational federalism model is often considered in societies with deep-seated ethnic or
religious divisions as a means to prevent conflict and promote political stability. However, its
success depends on the willingness of different groups to engage in power-sharing and
compromise for the greater good of the nation. Notable examples of consociational federalism
include the power-sharing arrangements in countries like Belgium, Switzerland, and Bosnia and
Herzegovin
Decentralized federalism
Decentralized federalism refers to a system of governance in which political power and authority
are distributed among multiple levels of government, with significant autonomy granted to
regional or local entities. In this model, the central government shares powers with subnational
units, such as states, provinces, or local governments, allowing them a substantial degree of self-
governance. Decentralized federalism aims to promote local decision-making, responsiveness to
regional needs, and the distribution of resources and responsibilities across various levels of
government.
Key features of decentralized federalism may include:
1. Devolution of Powers: The central government transfers certain powers and responsibilities to
subnational entities, empowering them to make decisions on local matters.
2. Local Autonomy: Regional or local governments have a considerable degree of autonomy in
areas such as education, healthcare, economic development, and infrastructure.
3. Fiscal Decentralization: The distribution of financial resources and revenue-sharing
mechanisms ensure that subnational governments have the financial means to address local needs
and priorities.
4. Local Representation: Citizens in different regions have representation at both local and central
levels, allowing for a more direct link between the government and the governed.
5. Administrative Independence: Subnational governments may have their administrative
structures, allowing them to implement policies and programs tailored to their specific
circumstances.
Decentralized federalism is often seen as a way to accommodate diverse regional interests,
promote local responsiveness, and enhance democratic governance. It provides flexibility in
adapting to regional variations and encourages local innovation in addressing specific challenges.
Examples of countries with a decentralized federal system include the United States, Canada,
and India and Pakistan, where states or provinces have significant powers.
