How Much Does Pakistan Transfer to the Provinces?
The Rs 8,848 billion that leaves the federal budget under the NFC formula
By the ISN Media desk • June 2026 • Approx. 5-min read
This is a short, factual answer about the share of national revenue that passes from the federal government to Pakistan's four provinces. The figures are Budget Estimates from the Government of Pakistan, in billions of rupees. For the full guide, see Pakistan's federal budget 2026-27, where every rupee goes.
How much does Pakistan transfer to the provinces?
Pakistan transfers about Rs 8,848 billion to its four provinces in 2026-27, out of gross federal revenue receipts of roughly Rs 20,600 billion. This is the provincial share under the National Finance Commission award, the constitutional formula that divides national revenue between the centre and the provinces. After the transfer, the federal government retains about Rs 11,751 billion of its own revenue.
What the transfer is for
The transfer exists because the eighteenth amendment devolved most responsibility for services such as health, education and local development to the provinces. They fund those responsibilities from this transfer, plus their own provincial revenues. So much of the country's spending on schools and hospitals appears in the four provincial budgets rather than the federal one.
Why it shapes the federal budget
The transfer is one of the most important figures in the budget because it determines how much the centre has left to work with. The federation collects about Rs 20,600 billion but keeps only about Rs 11,751 billion after the transfer. From that retained amount it must pay its own obligations, above all debt interest of about Rs 8,054 billion and defence, which is why the federal budget is so tightly squeezed and relies on borrowing.
How the formula works
The National Finance Commission award sets the share of the divisible pool of taxes that goes to the provinces, and divides that share among the four provinces using a formula based mainly on population, with weight also given to factors such as poverty, revenue generation and area. The award is renegotiated periodically, and the division of revenue between the centre and the provinces is a recurring point of political debate, examined in the 18th amendment explained.
Frequently asked questions
How much does Pakistan transfer to the provinces? About Rs 8,848 billion in 2026-27, out of gross federal revenue of roughly Rs 20,600 billion, under the National Finance Commission formula. The centre keeps about Rs 11,751 billion.
What is the NFC award? The National Finance Commission award is the constitutional formula that divides national tax revenue between the federal government and the provinces, and among the provinces themselves.
Why does the transfer matter? Because it determines how much revenue the centre retains. After paying the provinces, the federation keeps about Rs 11,751 billion but must cover interest, defence and its other obligations from it, which forces heavy borrowing.
What do the provinces do with the money? They fund the services devolved to them under the eighteenth amendment, including most schools, hospitals and local development, from the transfer plus their own revenues.
How is the provincial share divided? Mainly by population, with weight also given to poverty, revenue generation and area. The award is renegotiated periodically and is often politically contested.
How much does the federal government keep after the transfer? About Rs 11,751 billion of its own net revenue, out of gross receipts of roughly Rs 20,600 billion, after transferring about Rs 8,848 billion to the provinces.
Is the NFC award fixed permanently? No. It is renegotiated periodically between the centre and the provinces, and the division of revenue is a recurring point of political debate, with the centre under pressure given its large fixed obligations.
Why is the transfer one of the most important budget figures? Because it determines how much revenue the federal government has left to fund its own obligations, above all debt interest and defence, which in turn drives how much the centre must borrow each year.
Sources and notes
- Government of Pakistan, Federal Budget 2026-27 and the National Finance Commission award framework. Figures are Budget Estimates in billions of rupees, rounded for readability.
ISN MEDIA