Regional challenges remain an important challenge to the progress of democracy in Pakistan. Though momentous developments (18th Amendment, 7th NFC Award) have occurred, they have coincided with some of the worst fiscal imbalances the country has experienced, with all the associated consequences for macroeconomic stability and long-term growth. Analytical work on public finance and fiscal federalism, therefore, takes on added importance. The research agenda within this cluster looks at the revenue generating capacity of different taxes, institutional challenges for their implementation, and the political economy of their adoption. It also analyses the allocation and efficiency of public expenditure at both the federal and provincial levels.