KARACHI, April 6: Sindh has asked the National Finance Commission to give a 15 per cent weightage to the revenue generation capacity of the provinces and 70 per cent to the population in the resources distribution formula. The remaining 15 per cent weightage may be given to the poverty, development efforts and size of the provinces.

"These weightage ratios are negotiable," a well-placed source in the Sindh government informed Dawn on Tuesday, hinting at the possibility of getting involved in consultation with all the provinces to work out with consensus the weightage ratios of revenue generation, population, backwardness and other factors.

"There can be give and take on weightage ratios of these factors," the source said. "But in no way Sindh will drop the demand for incorporating the principle of revenue generation capacity as one of the key criteria for resources distribution," he made it clear. Sources claim that Balochistan was supporting Sindh in this demand and NWFP has not expressed any reservations so far.

"Only Punjab sticks to the status quo," he said and pointed out that in case NFC negotiations reached a dead end, it would only benefit Punjab. Under the present arrangement, the tax divisible pool is divided between the federation and provinces in the ratio of 62.5 per cent and 37.5 per cent. The 37.5 per cent resources are then shared by the provinces on the basis of population.

The sources ruled out any possibility of compromise on the principle of revenue generation be given due weightage in the NFC formula, if the allocation of resources for the next five years is found to be much more than what is being given under the 1997 NFC arrangement and is sufficient for the needs.

"It is not the amount of resources that matters," the source said and added: "Principles are sacrosanct. The principles in a federation are universal and beyond compromise."

East Pakistan was denied its majority and the unfair principle of parity was imposed, which resulted in separation of the bigger chunk of population. The sources say that the people of Sindh have a right to get a share in the financial benefits of all those persons and business concerns who are trading through two sea ports in the province and utilizing the infrastructure of this province.

Those watching the political developments at the national and provincial levels are convinced that Muttahida Qaumi Movement is now desperate to establish its credentials as the sole champion of whole Sindh. The Muttahida members of the Senate, National and Sindh assemblies have been very vocal on the NFC issue and have never minced words in expressing resentment on the unjust and unfair formula of resources distribution in previous NFC awards.

The military leadership also feels comfortable in negotiating with the urbanized leadership of Sindh and is expected to go an extra mile in convincing Punjab leaders of conceding to the principle of giving some token weightage to revenue generation.

Following the two-day NFC session at Quetta on March 30-31 in which representatives of the provinces and the federation just reaffirmed their respective positions, politicians have taken up the responsibility of finding some way out for a consensus.

The sources claimed that Sindh and Balochistan have reached consensus on sharing of the gas development surcharge. "We are only waiting for Islamabad to come out with a formula on how they compute development surcharge." Sindh supports, in principle, the demand of Balochistan to determine its share of gas revenue on market rate and not on volume.

For the last 50 years Sui gas has provided saving of billions of dollars in fuel imports. But hardly two per cent of Balochis enjoy the natural gas connection. The federal government never thought of setting up a permanent endowment fund for education, healthcare, vocational training and social welfare of the people of Balochistan.