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The term “federalism” describes a system of government in which sovereignty or power is constitutionally divided between a central governing authority and provinces/constituent units. According to some scholars it is considered as a significant part of democracy. Jai Prakash Sharma writes in his book, “….Again, also there were Gandhians wedded to decentralization, who thought democracy and federalism (decentralization) as synonyms” (Sharma, 1987, 24). Similarly Katharine Adney quotes Daniel Elazar who argues that “federalism exists to promote democracy, and therefore the two cannot be separated” (Adney, 2009, 88). It is a recipe in heterogeneous societies to promote cooperation and agreement in the social, political, economic and administrative fields. Federalism maintains a balance of power between the two units; their powers do overlap or collide, rather the two works for the mutual benefit of each other. Looking at the historical account of federal states, one would come to know that federalism arose out of a mutual bargain between different states in order to defend the country from an enemy attack. However post-colonial nations decided to be a federal state not for such defense purposes, rather because of colonial legacies. Post-colonial states such as Pakistan are multi-ethnic, multi-lingual and multi-cultural societies, where federalism adopted as an alien system of governance produced ethnic conflicts and ethnic divisions.

Few consider federalism as a panacea for ethnic conflicts in heterogeneous societies, while other argue that it exacerbates ethno-linguistic conflicts within a province due to neglect of minorities (Unpublished,Khan,6). Due to less power given to central/national government, it may also lead to hindrance in nation building (Mengisteab, 1997, 114). One of the assumed advantages of federalism is “fiscal federalism theory” which states that this system of governance gives maximum financial autonomy to constituent units. Contrary to this theory, Wibbels mentions that federalism leads to difficulties for economic reforms in the developing countries (Wibbels, 2000, 687).

Above discussion shows that there are positive (decreasing ethno-national conflicts) as well as negative (increasing ethno-linguistic conflicts) consequences of federalism and the use of federalism as a mechanism of ethno-national conflict resolution and economic performance regulation is controversial. Being a significant part of democracy and having controversial consequences it is important to explore whether any limitations exists on the smooth running of federalism in Pakistan. The focus of this paper will be to find structurally imbedded limiting factors and hindrances which for the last 60 years have made federalism a failed system of governance in Pakistan. Breaking away of East Pakistan, ethnic conflicts in NWFP and Sindh are evident of the fact that federalism has failed to take roots in this country. Moreover this paper will also argue that federalism also becomes a hindrance for economic reforms within the country.

The paper will analytically discuss literature review regarding positive and negative aspects of federalism. It will analyze that amongst both the perspectives, the negative aspects of federalism has affected Pakistan more, making it a failed system. In first section, this paper will discuss the case of Sindh and hold the preposition that federalism has led to more ethno-linguistic conflicts within the province. The mobilization of minority group (Muhajirs in Sindh) is due to constitutionally protected ethnic policies of the dominant groups (Sindhis in Sindh). Protection of dominant groups in a province has been facilitated by federal structure of 1973 constitution, and this eventually results in exacerbation of ethno-linguistic conflicts within the province. Later it will be argued that federalism has led to demand of more provinces, and fulfilling that demand is very costly in present situation. In second section it will be argued that federalism has led to difficulty in economic reforms since the division of power between the center and constituent units make decision making ineffective. At the end it will be concluded that due to economic inefficiencies and ethno-linguistic conflicts, complete implementation of federalism is not desirable for Pakistan.

This paper is based on secondary research. It will help me to do extensive research. However the problem with secondary sources is that most of the articles and books are based on external scholarly work. There can also be over-stated arguments (biasness) in their work. That is why I am also using some (quantitative study) statistical findings.

Literature review;
The outcome of federalism on welfare of a country is ambiguous. There has been a lot of literature written on positive as well as negative aspects of federalism. Kidane Mengisteab says that the process of state building through federalism have been widely resisted by many African leaders and scholars (Mengisteab, 1997, 114). She (qtd Nkrto conceive economic development and democratization without a viable and active centre. Majority African leaders viewed federalism as a divisive arrangement that would lead to secessions. As a result, a unitary centralizing strategy of state building was widely adopted in the continent (Mengisteab, 1997, 120). He himself concludes that it is hard to visualize that solutions to the wide spread ethnic conflicts and crisis of state building would be fulfilled in the continent (Africa) without some type of decentralization (Mengisteab, 1997, 129).  

Discussing relationship between federalism and economic performance, Erik Wibbels says that federalism has negative impact on economic performance and reform. He mentions that to accommodate interests of individual provinces, it becomes very difficult for center to implement unpopular policies. Wibbels argues that the macroeconomic and fiscal imbalances experienced in federal nations are due to devolved political and fiscal institutions that create incentives for sub-national (provincial) governments to avoid the political costs of fiscal adjustment (Wibbels, 2000, 687). Contrary to fiscal federalism theory, however, empirical findings suggest that decentralization (federalism) has led to higher inflation and larger deficits in developing nations (Wibbels, 2000, 687). Attached Table 1(Wibbels, 2000) shows that there is negative relationship between federalism and economic performance.

On the contrary Robert P. Inman concluded that decentralization has a unique contribution “to make to a society's ability to enforce property rights, to protect political and civil rights, and then because of such rights protection, to enhance private sector economic performance” (Inman, 522). He says that due to protection of rights thorough federalism, economic performance of an individual increases, which eventually led to welfare of a country. Similarly it is also argued that in Pakistan provincial governments are better able and efficient to collect small taxes. Central government has a good infrastructure but they are inefficient in collecting small taxes (Jaffaray; Sadaqat, 2006, 210). The responsibility of tax collection should be in hands of provincial governments.

Katherine Adney argues that in Pakistan, ethnic conflicts can be resolved even in a non-democratic setting if there is representation of the provinces in the bureaucracy and the army. She says that for resolution of ethnic conflicts, democracy or federalism; which ensures provincial participation and devolution of subjects from centre to provinces, is not necessary. Equal representation in army and bureaucracy is necessary to accommodate interests of provinces (Adney, 2009, 4). In other article Adney says that federalism is not able to resolve ethnic conflicts in heterogeneous province; a province in which there is significant amount of minority group beside ethno-national group (Adney, 1997, 6). Presence of minorities with in a province leads to serious conflicts and it is almost impossible without genocide and forced population transfers to avoid the existence of some peoples who do not belong to the dominant ethno-national group within the heterogeneous province (Adney, 1997, 6). She (qtd Berans) says that national and ethnic groups should not be allowed to govern themselves unless interests of minorities within a province are secured (Adney, 1997, 6). He also discusses limitations of federalism in a country of homogenous provinces. It is argued that federalism leads to ethno-nationalistic conflicts in a country of homogenous province due to resources, legitimacy and dominancy that some ethnic groups attain; a major cause of secessions (Adney, 1997, 7). It shows that there are limitations of federalism in both the homogenous as well as heterogeneous provinces countries. This argument of heterogeneous province can be applied against implementation of federalism in Pakistan, as table 1 (attached) show that there are many ethnic and linguistic divisions within every province.

Pakistan is a multiethnic, multi-cultural and multi-lingual state. Its provinces are associated with particular ethnicities; Punjab with Punjabis; Sindh with Sindhis; Baluchistan with Balochs; and Khyber Pakhtunkhwa with Pashtuns. There are ethnic and linguistic divisions within every province. Sindh is the most ethnically diverse province of Pakistan. Muhajirs form the majority in urban Sindh. Sindhis dominate the rural Sindh. Baluchistan is the home province of Balochs and Pashtuns. Punjab and NWFP are also no more homogenous provinces. Southern part of Punjab also contain considerable amount of Siraiki speaking people and NWFP hosts Hindko and Siraiki speaking populations as well. Statistics, which show percentage of linguistic groups, are given in attached table 1). Table 1 (Mushtaq, 2009) shows that there are different linguistic groups present within a province; hence the Adney argument of limitation of federalism applies to Pakistan.

Pakistan has been a federating state since independence due to the constitutional legacy of British India. It experienced different constitutional arrangements (Parliamentary and Presidential) but it maintained federalism throughout its constitutional history. All of its constitutions (1956, 1962 & 1973) have federal order but there is variation in the extent of federalization. To understand the limitations of federalism, we need to see the two phases of (1947-71) and (1973---). The first phase was characterized by centralization of authority, 1 unit plan (West Pakistan is 1 unit), and elimination of the federal structure within West Pakistan (Waseem, 2010, 5). It is not considered as truly federal era. Non-implementation of federalism was to counter the demands of East Pakistan and to justify the need of unity in newly established state. In the second phase (after the succession of East Pakistan) to avoid another division and to abandon high representation of certain dominant ethnic groups in civil bureaucracy and in military, federalism bounced in 1973 constitution back
       1)      Federalism and ethno-linguistic conflicts;
Although 1973 constitution is considered as truly federal as it initiated a senate in which equal representation of all four provinces was there but it brings despair in Muhajirs (Urdu speaking people of Urban Sindh). It brings ethnic quotas in civil services and in education. These arrangements bring grievances in Muhajirs because previously they were better represented in civil bureaucracy but now they are not (Khan, Unpublished, 12). So Bhutto’s ethnic preference policies effectively closed the door for Muhajirs in civil services and in educational institutions.

Quota and language policies of Bhutto lead to ethnicization of Muhajirs, and Sindhi-Muhajir conflicts increased due to this. Muhajirs were actually nationalist but ethnic based policies of Bhutto lead them to formation of MQM (Muhajir Qoumi Movement) in 1984 (Khan, Unpublished, 14). According to Khan:
The mobilization of separate Muhajir identity began in the early 1970s not as a direct response to relative economic deprivation, but in anticipation of loss of political and economic dominance that the new federal structure portends for the Muhajirs (Khan, Unpublished, 14).
The Sindhis-Muhajirs polarization worsened dramatically with the emergence of the MQM. The increasing violence between Muhajirs and other ethnic groups (Sindhis, Pathans) in Sindh had finally brought the MQM in to hostile confrontation with the Pakistan army itself. The army operation Cleanup, as it was called, took the form of an urban guerilla war in Karachi, killing thousands of Muhajirs and exposing the army to accusation of genocide (Khan, Unpublished, 10).

Discussing causes of ethnic conflicts Khan quoted Chua, who says that ethnic conflicts are not only due to economic backwardness of one province as compared to other, which can be solved by federalism. It is due to the antagonism against numerically weaker but dominated group within a province (Khan, Unpublished, 24). It can be implied that that, Chua's argument of ethnic conflicts applies to Pakistan, as numerically weaker but dominant group are present in Sindh, and also in other provinces (Appendix, Table 1). Federalism has led to emergence of new ethnicity and exacerbation of conflicts.

Federalism has also led to further demand of provinces. Renaming of NWFP and passing of 18th amendment laid out the ground for a demand for new provinces on the basis of language. Several political parties asked the federation to create new provinces, such as four out of Punjab, two out of Khyber Pakhtunkhwa, two out of Sindh and three out of Baluchistan (Waseem,2010 20). Federalism (18th amendments) gives an incentive to demand for new provinces on the basis of language. Language as an instrument of federalization is not desirable in Pakistan, because creation of more provinces may lead to more administrative costs and hence more corruption. Moreover it will lead to disunity, which will hinder nation building.

       2)      Federalism and economic reforms;
There is also a relation between federalism and economic performance in Pakistan. Federalism has led to poor economic reforms. Wibbels has shown in his regression results that in developing countries federalism has negatively affected the capacity of national government to implement economic reforms (Wibbels, 2000, 698). His sample also included Pakistan and results of his regression were statistically significant (attached, table 2). However inclusion of Pakistan in his sample does not necessarily means that this negative correlation also applies to Pakistan. But Wibbels (qtd World Bank report 1996a, 1996b; Sato 1994) argues that in nations such as Argentina, Pakistan, and India, decentralization designed to cover provincial fiscal imbalances led to provincial deficits (Wibbels, 2000, 698). He (qtd Sato) says that federalism is a threat to national reform efforts in these countries (Wibbels, 2000, 698). According to Shoaib A.Ghias, economic growth depends upon the degree to which a regime is capable to implement its unpopular policies (Shoaib, 2009 3). A regime is capable to implement its policies if the centre is powerful and gives less consideration to the interests of individual provinces. Although devaluation of currency is unpopular along masses, especially for agriculture sector in Pakistan but Ayub Khan was able to implement it to promote industrialization. Devaluation of currency was harmful for exporters of agriculture (masses), but Ayub was able to implement it to pursue long term goals, because there were no political motives at provincial level at that time. Due to industrialization overall growth rate of GDP was 9.8% and GNP as 9.9%, which is highest in the entire history of Pakistan. If provinces were fully protected and federalism was there, then it may not have been possible for Ayub to promote industrialization, because that policy badly affected the agriculture sector of the masses. Members of provincial assembles could have political motives in not implementing it, but as there was no direct role of provincial assemblies at that time, it is possible that they couldn’t have care much. It seems that Wibbels argument of affects of federalism on economic performance applies to Pakistan.

Presently, due to federalism it becomes very difficult for centre to initiate mega projects. The provincial governments are opposed to the development of various projects such as Makran Coastal highway, Gawadar Port in Baluchistan, etc. The provincial governments often state that such projects should be their prerogative. Center on the other hand has been unwilling to stick to their demand, which leads to conflict and failures of developmental projects.

Provincial banks in Pakistan lack the capacity to finance the projects and provinces also lack the infrastructure to carry out many functions, which centre can. Wibbels says that provincial governments in developing countries have limited capability to borrow money from international financial institutions. They can only borrow from local, national and provincial banks (Wibbels, 2000, 698). In Pakistan also there is very limited capability for provincial banks to finance and maintain the projects (Jaffaray; Sadaqat, 2006, 211). Provinces also lack the infrastructure to carry out the function of devolved subject from centre. A case in hand is the devolution of Higher education commission to provinces. Since HEC is a centralized authority with controls and checks on quality of higher education, its devolution to provinces may disrupt the quality and standardization of higher education. That is why recent devolution of HEC has led to mass protests. This protest shows limitations of federalism (incapability of provinces in carrying out certain functions.

Federalism has led to serious conflicts between Muhajirs and Sindhis. Although affect of decentralization on conflicts in other provinces has not been covered in this paper, but the presence of heterogeneous groups shown in table 1, indicate that there is a potential that can lead to severe conflicts in other provinces also. For example discontent among Hazara people (minority) emerged due to federalism and protecting the rights of Pashtoons (dominant majority). Muhajirs-Sindhis conflicts prove the Adney’s (1997) argument of exacerbation of conflicts in heterogeneous provinces.

Following Wibbels (2000) federalism has also led to poor economic performance because of political motives in provincial developmental projects, incapability of provincial banks to borrow from financial institutions and lack of infrastructure in provinces to carry out the functions of devolved subjects. It proves the Wibbel's argument of presence of constraints in provinces of developing countries. Imam's argument of increasing efficiency due to protection of property rights does not apply to Pakistan significantly, which may be due to poor legal enforcement.

The argument of exacerbation of ethnic conflicts cannot be generalized to Punjab, because it is a homogenous province. Moreover it cannot be said that severity of conflicts between Hazare people and Pashtoons is comparable to that of Muhajirs and Sindhis. It also cannot be said that same limitations of federalism apply to every multi-ethnic country because unlike Pakistan, India was reorganized on the basis of language. Pakistan at this point, due to economic constraint is not able to reorganize it on the basis of language.

Pakistan is going to be in severe financial crises, so it needs strong center to implement politically un-popular policies and projects in provinces. Promoting federalism and making more provinces will incur huge cost which will lead to more economic crises. The devolution of subjects and their transfer to provinces must be carefully planned and executed. Political motives in this process would be likely to destroy any improvements. It must be thoroughly assessed before devolution that weather a province has the required structural framework to handle the devolved subject. Transfer of subjects just for the sake of transfer without a careful analysis risks the further deterioration of subjects for example HEC devolution was not a favorable step.

Following Adney (2009) instead of full implementation of federalism (devolution of every subject and making of provinces on basis of language), representation of provinces in army and bureaucracy (consociational federalism) will be more desirable, and to know the effectiveness of it needs more research. However it will not need devolution of subjects, and will not lead to despair in minorities due to protection of majorities. 1st preference should be economic reforms, which is only possible thorough strong centre. Once economic reforms are taken then we will be able to bear the cost of making provinces on the basis of federalism.


Table 2; The linguistic composition of the states in Pakistan.                 

State of Pakistan

Linguistic Breakdown of State
Baluchi 34%, Pushtu 23%, Sindh
16%, Punjabi 7%, Urdu 1%, Others

East Bengal
Bengali 98%, Urdu 0.6%, Other 1%

Federal Capital Area
Urdu 50%, Sindhi 14%, Punjabi 9%,
Baluchi 9%, Pushtu 3%, Bengali
0.2%, Other 14%

Pushtu 79%, Punjabi 17%, Urdu
0.8%, Other 3%

Punjabi 94%, Urdu 5%, Pushtu 0.2%

Sindhi 74%, Urdu 10%, Baluchi 9%,
Punjabi 3%, Other 4%

1951 census from (Mushtaq, 2009)

Written By: Shiraz Hassan (LUMS)

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