Proposed merger: Funds allocation likely to be a bone of contention

Up to Rs120b from federal consolidated pool of Rs4tr will have to diverted to Fata

PESHAWAR: The stalemate over the future status of the Federally Administered Tribal Areas (Fata) is likely to end as the stakeholders have decided in principle to merge Fata with Khyber-Pakhtunkhwa. However, allocation of 3% federal divisible pool for the areas’ development is still a sticking point.

A close aide to the prime minister told The Express Tribune that while the general perception is that Fata reforms have stalled over the reluctance of two key allies of the federal government – the JUI-F and PkMAP – the real issue is allocation of funds from the National Finance Commission (NFC).

“The reforms package, which in all probability will be presented to the cabinet in the coming week, is expected to get the nod if all goes as planned.



“However, the areas’ ten-year plan for development may face unnecessary delays in the future if provinces and the Centre do not agree to the cuts that they will have to face in the NFC award,” he added.

A senior government official privy to the developments said the federal consolidated pool is Rs4 trillion, approximately 3% of which – amounting to Rs120 billion – is for Fata.

Of this 120 billion, Rs51 billion will have to be paid by the federal government, while the remaining Rs69 billion will be churned out of the provincial share.  Punjab will face the largest cut of Rs36 billion followed by Sindh’s Rs17 billion, K-P’s Rs10 billion and Balochistan’s Rs6 billion.

“But all of this has to be decided before the provinces present their next budget,” he said, adding that the 25% of the reforms in Fata require no money but the remaining 75% do need funds. “The establishment of a justice system in the tribal areas is the most needed and costly component,” he added.



The committee on Fata reforms presented its report to Prime Minister Nawaz Sharif on August 23 last year, which was then tabled before the National Assembly on September 6 and finally before the Senate on September 27, 2016.

However, the report was deferred when it was presented before the cabinet for approval in December after – according to insiders – the JUI-F’s Akram Khan Durrani, who is also the federal minister for housing and works, said he would boycott the meeting if the cabinet went ahead with the report.

Earlier this month, the report of the committee was again dropped from the agenda on the pretext of developing consensus amongst all stakeholders.  This resulted in severe criticism even by elected representatives of the ruling PML-N from Fata.

A long march – announced by lawmakers, political parties and civil society from Fata – is still on cards for if the federal cabinet does not approve the reforms for the areas.

However, the K-P government has also decided to step in to resolve the issues. “PTI chief Imran Khan has directed Chief Minister Pervaiz Khattak to take a robust stand on the issue,” an insider told The Express Tribune after Imran held a meeting with government functionaries in Peshawar.

“Khattak was asked to start contacting chief ministers of other provinces on the NFC allocation,” he said, adding that Imran had given clear instructions to take ownership of the cause.  “Even if the province loses Rs10 billion, it will ultimately gain by the merger,” he quoted the PTI chief as saying.



A copy of the 23-point response of the K-P government to the Fata Reforms Committee shows that K-P wants the 3% allocation for Fata detached from other proposed allocations for Gilgit-Baltistan, Azad Jammu and Kashmir, security of the China-Pakistan Economic Corridor (CPEC) and climate change.

The summary for approval of the cabinet on Fata reforms – a copy of which is available with The Express Tribune – is a 19-point request which begins with approval for merger of Fata with K-P and ends with making the Committee for Fata Reforms a permanent body by converting it into a cabinet-level implementation committee with the addition of the K-P CM, commander 11thcorps and chief secretary.

Published in The Express Tribune, February 19^th, 2017.