Finance Minister Muhammad Aurangzeb on Tuesday assured full support to the Khyber-Pakhtunkhwa government for the resolution of all its legitimate issues, including prevailing financial challenges.
According to a statement issued by the Finance Ministry, the two officials met at the Finance Division in Islamabad in a cordial and constructive atmosphere. During the meeting, it said, the chief minister briefed Aurangzeb on various economic and financial challenges facing his province.
The finance minister assured Afridi the federal government was committed to facilitating provincial governments in addressing their financial difficulties.
The meeting followed repeated allegations by Afridi regarding the center’s delay in releasing funds under the National Finance Commission Award intended for the erstwhile tribal districts. Last week, the province’s representatives staged a walkout of a meeting deliberating on the 11th NFC to protest an “unconstitutional formula” that they said did not factor in the population of the merged areas.
The chief minister also raised the issue of KP’s financial difficulties with Prime Minister Shehbaz Sharif last month, warning the delayed federal payments were pushing the province toward a “severe financial crisis.”
Targeted subsidy
Separately, the finance minister met the top political leadership of all provinces, with all stakeholders agreeing to a working framework outlining the broad contours of a possible targeted subsidy mechanism amidst an ongoing fuel supply crunch.
In a press release, the Finance Ministry said the provinces had agreed to continue refining their proposals and aimed to reach a consensus-based and practical solution.
The meeting emphasized the need to ensure transparency, accountability and effective governance structures in designing and implementing future subsidy arrangements. The participants also highlighted the need for a coordinated national approach, alongside flexibility for provinces in execution.
The meeting comes amid reports the government is gearing up for another major increase to ex-depot prices of petroleum products. Last month, following the launch of the Iran war, the government increased diesel and petrol prices by Rs. 55/liter each. In the three weeks since that increase, the government has maintained prices, offsetting the price differential through a blanket subsidy that has cost an estimated Rs. 125 billion so far.