Karachi’s 'political orphanhood' deepens as funds bypass city

Karachi, Pakistan’s largest city and economic powerhouse, remains neglected and financially powerless despite contributing the bulk of the nation’s taxes, journalist Kamran Khan said in a vlog.

He said Karachi generates about 65 percent of Pakistan’s federal tax revenue and fills 90 percent of Sindh’s coffers but continues to live “like an orphan.” Broken roads, overflowing garbage, unsafe public transport, and chronic water shortages have become the city’s identity, he said, even as global surveys rank it among the world’s least livable cities.

Khan argued that the city’s decline stems from the 18th Amendment and the National Finance Commission (NFC) award, which transferred resources from the federal government to the provinces but left local governments underfunded.

In Sindh, he said, nearly all key services — water and sewerage, solid waste management, master planning, building control, transport, land utilization, health, and education — remain under the provincial government’s control.

The Constitution’s Article 140-A requires provinces to devolve administrative and financial powers to local governments, but Khan said Karachi’s revenue sources have instead been seized. “Rather than empowering the city, its income streams have been looted,” he said.

Khan cited research by former federal finance secretary Younus Dagha, showing severe underfunding of Karachi over the past 15 years. From 2010 to 2025, the Sindh government spent 3.87 trillion PKR on development. Based on its 37 percent share of the province’s population, Karachi should have received about 1.42 trillion PKR but got only 472 billion PKR — a shortfall of 944 billion PKR.

At the federal level, Khan said, the Public Sector Development Program (PSDP) should have allocated 756 billion PKR to Karachi over the same period but delivered just 340 billion PKR, leaving another 416 billion PKR unaccounted for. Combined, he said, the city has been deprived of nearly 1.36 trillion PKR.

Khan also pointed to the Infrastructure Development Cess collected at Karachi’s ports to maintain roads and highways damaged by heavy cargo movement. Last year alone, this levy brought in 170 billion PKR, and total collections have reached about 1 trillion PKR since its inception. Yet, he said, the Sindh government absorbed the funds instead of reinvesting in Karachi. Another revenue stream — the octroi and zila tax (OZT) — was abolished under the 18th Amendment and NFC award.

While provinces grew richer after the 18th Amendment, Khan said, the Provincial Finance Commission has been “dead for 15 years,” leaving municipal governments broke and powerless. He warned that this neglect fuels growing demands for new provinces or stronger administrative units in urban centers.

“Karachi’s three crore residents remain voiceless,” Khan said. “They carry Pakistan’s economy but get crumbs in return.”