President Zardari approves Mahfooz Ali Khan as Balochistan’s representative in the 11th NFC constitution, replacing the earlier nomination. On Saturday, August 30, 2025, President Asif Ali Zardari approved a change in the 11th National Finance Commission (NFC) constitution, nominating Mahfooz Ali Khan as Balochistan’s non-ex officio member, following the provincial government’s revised recommendation. The President’s Secretariat announced this at 2:00 PM.
Why It Matters
The NFC constitution shapes Pakistan’s fiscal federalism, determining how resources are shared between the federation and provinces, impacting development and governance across South Asia’s second-largest economy.
Revised Nomination in NFC Constitution
The President’s Secretariat issued a statement confirming the amendment to the 11th NFC constitution, necessitated by Balochistan’s decision to revise its nominee. According to the President’s Secretariat on X, Mahfooz Ali Khan replaced Farman Ullah, superseding Zardari’s approval from the previous week. The change ensures Balochistan’s representation aligns with its government’s latest preference, maintaining provincial input in the commission’s deliberations.
The 11th NFC, constituted on Friday, August 22, 2025, comprises nine members, chaired by the federal finance minister. Ex-officio members include the finance ministers of Punjab, Sindh, Khyber Pakhtunkhwa, and Balochistan. Each province nominates one expert: Punjab’s Nasir Mahmood Khosa, Sindh’s Dr Asad Sayeed, Khyber Pakhtunkhwa’s Dr Musharraf Rasool Cyan, and now Balochistan’s Mahfooz Ali Khan.
Scope of the 11th NFC
Fiscal Responsibilities and Objectives
The NFC is tasked with recommending the distribution of net proceeds from federally collected taxes, grants-in-aid to provinces, and the borrowing powers of federal and provincial governments. The commission will also address financial responsibilities for national and trans-provincial projects, alongside other fiscal matters referred by the president. These recommendations, known as the NFC Award, are critical for balancing resource allocation in Pakistan’s federal structure.
Dissolution of the 10th NFC
The Finance Division’s notification on August 22, 2025, dissolved the 10th NFC, formed in July 2020, to pave the way for the new commission. The 11th NFC’s terms of reference were submitted to President Zardari, outlining its mandate to address pressing fiscal challenges. According to the Finance Division on X, the new NFC aims to enhance fiscal equity and address provincial disparities, though specific details of the terms remain undisclosed.
Additional Legislative Action
On the same day, President Zardari signed the Criminal Laws (Amendment) Bill 2025, removing the death penalty for certain offences in the Pakistan Penal Code and replacing it with life imprisonment to align with international human rights commitments. This dual action underscores his role in shaping both fiscal and legal reforms.
Background
The NFC, mandated under Article 160 of Pakistan’s Constitution, is reconstituted periodically to negotiate resource distribution between the federation and provinces. The 7th NFC Award in 2010, for instance, increased the provinces’ share to 57.5% from 47.5%, a landmark shift in fiscal devolution. The 10th NFC struggled to finalise a new award, leading to its dissolution. The 11th NFC’s formation comes amid economic pressures, including a PKR 9.4 trillion federal budget deficit in 2024–25 and demands for equitable resource allocation from provinces like Balochistan, which often cite underdevelopment.
What’s Next
The 11th NFC, with Mahfooz Ali Khan as Balochistan’s representative, will begin deliberations to finalise the NFC Award, expected to influence Pakistan’s fiscal policy for the next five years. The commission’s recommendations, due to be presented to President Zardari, will shape the NFC constitution’s impact on federal-provincial relations and economic stability.
Published in SouthAsianDesk, August 30th, 2025
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