New formula takes centre stage: NFC meeting set to take place on Nov 18th

ISLAMABAD: In a major push to revive stalled fiscal harmonisation talks, the federal government has moved to convene the long-awaited meeting of the National Finance Commission (NFC) on November 18, well-placed sources told Business Recorder.

The meeting marks a potentially decisive moment in the prolonged effort to strike a fresh revenue-sharing pact between the Centre and provinces.

Finance Minister Muhammad Aurangzeb will chair the high-stakes huddle in Islamabad, where key provincial and federal stakeholders are expected to take up the thorny issue of a new NFC Award — a vital mechanism that determines the distribution of national financial resources and underpins Pakistan’s fiscal federalism.

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An earlier session slated for November 10 was pushed back due to the unavailability of some members. “If the November 18 meeting takes place as scheduled, it will signify a major leap forward in the NFC process,” a senior official said.

Sources said the inaugural sitting of the Commission is expected to review working-level recommendations, establish technical sub-groups, and approve a roadmap for negotiations over the coming months — laying the foundation for what federal officials describe as a “time-bound and outcome-oriented” process toward a fresh Award.

The 11th NFC was formally notified by the President on August 22. However, its maiden meeting, originally planned for August 28, was postponed at the request of the Sindh government, which cited the province’s emergency following devastating floods. According to the Finance Division, the NFC Secretariat deferred the session after receiving Sindh’s formal request.

Officials acknowledged that the Centre’s constrained fiscal space, rising debt servicing burden, and provinces’ demand for greater autonomy and resource allocation could make the negotiations complex.

“Progress at the NFC table is no longer optional — it is essential for the stability of Pakistan’s fiscal architecture,” one source remarked, adding that the upcoming session is expected to set the tone for a “structured, consensus-driven” path forward.

If held as planned, the November 18 meeting will mark the first formal step in finalising a new formula to replace the 7th NFC Award, which has effectively governed federal-provincial financial relations for over a decade.

Copyright Business Recorder, 2025