The Role of NFC Award in Incentivizing Population Growth in Pakistan

Abstract

The majority of the population control projects in Pakistan have failed for several reasons. The incentives in the National Finance Commission (NFC) Awards, is a major contributor for it. The NFC awards serve as a mechanism for allocating or distributing federal resources among provinces. With 82% weight in the 7th NFC awards, Pakistan's resource distribution is primarily based on its population. with such massive weightage, provinces apparently want more population to increase its share in national resources.  Ostensibly, Pakistan divides its political and economic power according to its provincial population. This has negative implications for Pakistan’s deteriorating financial and human development. This study examines the relationship between population growth and the NFC Awards. It argues that the current resource distribution mechanism encourages provinces to increase their population, leading to disparities and poverty among them. This research paper discusses how NFC contributes to population growth and creates political-economic gaps among provinces. The study recommends that Pakistan should restructure the resource distribution formula by prioritizing population control rather than giving incentives that increase it. A mixed-method approach was used for this study. This study also recommends that the population weightage should be reduced giving more weightage to other indicators such as poverty and backwardness, also introducing other indicators such as education and development requirement.