March 30, 2006	Thursday	Safar 29, 1427

KARACHI, March 29: The budget-making exercise in Sindh picked up momentum on Wednesday after direct intervention from the highest level in Islamabad on Monday to end friction in the ruling coalition set up in Karachi, and well-placed sources now speak of a quick devolution of many functions and resources.

“From July next onward, salary and development funds will be released directly to the local governments at all levels in the province,” a source informed Dawn. Under the stewardship of Dr Abdul Hafeez Sheikh, the former provincial finance minister, Sindh was the first province to draw up a Provincial Finance Commission (PFC) award. But in implementation, the flow of fund to the districts was against the spirit of the PFC award that created a lot of acrimony and bitterness.

At the same time, efforts are being made to devolve collection of agricultural income tax and other levies at the level of various tiers of the local governments.

The local governments at various levels complained of being deprived of their autonomy in framing their development strategy, and delay in release of funds adversely affected their functioning and delivery of services.

“Henceforth there will be one liner allocation of resources to the local governments in the provincial budget,” the sources said.

Before the local bodies elections there was a lot of firework between the leaders of the local governments, including that of Karachi and the MQM-dominated provincial government. The affairs within the ruling coalition were not very happy, which affected the smooth functioning and delivery of services.

A World Bank report in May last year observed the coalition government in Sindh “burdened with the political stalemate” which inhibited it to focus on developing a type of vision, action plan and implementation drive in which Sindh was a leader in implementing reforms in early years.

The situation in Sindh, according to the World Bank, was so hopeless that the “progressive policymakers, resilient business community and activist civil societies of Sindh have given up any hope of creating a more prosperous Sindh”.

In yet another exercise of a primary survey of key stakeholders in Sindh in December, a team of World Bank consultants found that majority of them mentioned the “poor governance” as the single most developmental challenge facing the province. “Corruption and law and order, the logical derivatives of weak governance, emerged as the second and third most critical challenges to the Sindh.” The World Bank team found the regional divide -— urban and rural in Sindh — another big challenge, which was not being comprehended by the stakeholders.

A follow-up report of the World Bank in January 2006 based on detailed consultations with the senior functionaries of the provincial government is in fact a harsh indictment on the economic and financial performance of Sindh where “finances are under increased pressures”. The rise in fiscal deficits is causing concerns “about the future viability of the provincial finances”.

All these observations of the World Bank and growing acrimony and bitterness between Chief Minister Arbab Rahim and MQM ministers forced the authorities in Islamabad to intervene and bring some sort of understanding. Apparently, the understanding has been reached but its sustainability remains a big question mark.

While the differences in coalition government of any other province could have been taken in stride, the situation in Sindh is different. The friction and bitterness generated by political differences in the ruling coalition does not remain confined to the top level. It divides the bureaucrats and disturbs people at the grassroots level.

In the past also when the MQM was a partner with the Pakistan Peoples Party and then with the Pakistan Muslim League (Nawaz group), the break-up of the coalition caused a serious law and order problem in the province. It had severe economic and financial implications that pushed Sindh further backward in the race of progress.

With the general elections hardly a year ahead, the ruling set-up in Islamabad is determined to see the assemblies and coalition governments, including that of Sindh, remain saddled.

Considered to be a reincarnation of the late Jam Sadiq Ali, Arbab Rahim is loud in speech and ruthless in action. The late Jam Sadiq was soft in speech but harsh and callous in action. Mr Arbab has justified his position by manipulating the last local bodies elections to the delight of people in Islamabad. Those who underestimated him have seen the fate of Imtiaz Sheikh, a bureaucrat who enjoyed the support of powerful political families of Punjab and the mighty institutions. Imtiaz is now reduced to nothing in the politics. Arbab Rahim fits well in the game plan designed by the high and mighty.

The MQM will now have to work hard to suppress its ambitions of overstretching its influence to the small cities and rural areas of the province. After entering into partnership and then quitting, one after the other, with two major political parties, the MQM has very little choice to abandon the third party which is not political.

Land management in Karachi is not an issue between the coalition partners of the provincial government. There are many other players who are causing heartburning to the people of the province. There are cantonment boards, KPT, Port Qasim, Railways. Unless addressed in a decisive manner to bring the entire land management under a single authority, the land allotment is fraught with dangerous consequences.

So is the case of recruitment in the provincial government where the rule of the day has been to allocate quotas to the political parties. Add to this, the problem of postings and transfers.

Al said and done, Sindh now looks for a leadership who has vision to develop strong and unbreakable linkages between the urban and rural population. This is a challenge to the ruling coalition and to the Pakistan Peoples Party that undoubtedly remains the popular party notwithstanding the results of the last local bodies elections.