ISLAMABAD, Dec 18: President Gen Pervez Musharraf will soon invite all chief ministers to finalise the seventh National Finance Commission (NFC) award, says a top government advisor. “The chief ministers have given the president the mandate to finalise the NFC award. Now the latest situation is that the president is soon inviting them (the chief ministers) to finalise the award,” said Dr Salman Shah, advisor to the prime minister on finance, told reporters after inaugurating an exhibition here on Sunday.
The seventh NFC award has been pending since 2001 because of a lack of consensus among the provinces over its formula. The sixth NFC Award had been announced in 1997.
The federal government has reportedly proposed multi-factor formula for horizontal distribution of the net proceeds of the federal divisible pool among the provinces.
The new formula envisages 90 per cent weight to population , and the remaining three per cent to other three factors - revenue, poverty and inverse population density.
If implemented, the new formula would enable smaller provinces to get larger shares in percentage terms, including subventions and special grants. According to the formula the share of Balochistan should be higher than 8.75 per cent, 15 per cent for the NWFP and about 24 per cent for Sindh.
KALA BAGH DAM: Referring to the financial implications of Kala Bagh dam, Mr Shah said: “This is a viable project with high returns.”
He said each component of the mega project would have high returns in terms of pay back. Once the government took the political decision of constructing the dam, international and domestic financial institutions would be tapped. However, the international financial institutions would play a greater role, Mr Shah said.
