Sindh budget.

ITS resource constraints notwithstanding, Sindh's budget of Rs1,241bn for the fiscal year 2020-21 indicates the seriousness of Chief Minister Murad Ali Shah's administration in fighting Covid-19 and its negative economic impact on the poor and small businesses. It is commendable that Sindh has made sensible choices at a time when the country is faced with not only the virus contagion but also the threat of an unprecedented locust plague. The new budget, for example, sets aside a substantial sum of Rs20bn to put cash into the pockets of those affected by Covid-19. Similarly, health expenditure for the next year has been enhanced by 15.5pc. Even the 7pc increase in Sindh's current expenditure comes from higher Covid-19-related spending. Education is the only other sector - apart from health - where the cash-strapped government has raised allocations instead of reducing it. Additionally, the budget proposes interventions to stimulate small businesses in urban areas through soft loans, alleviate poverty, subsidise wheat flour and support farmers hit by locust swarms.

However, the sustainability of the provincial Covid-19 initiatives largely depends on the federal government's ability to collect its targeted taxes and transfer the province's projected share to it. Like other provinces, Sindh also depends heavily on federal transfers for almost...