Balochistan is the largest province in terms of size and smallest in terms of population. These distinguished features offer both challenges and opportunities for development. On the negative side, Balochistan bears the second highest incidence of multidimensional poverty after the erstwhile Federally Administered Tribal Areas. On the positive side, the province houses abundant natural resources which could drive prosperity in the province. However, the province has not been able to optimally capitalize its potential, owing to a myriad of issues, some narrated below.

The planning and financial management process in the province needs a major shift. The 7th National Finance Commission (NFC) has increased the flow of finances from the central government to Balochistan from 7 percent in the 6th NFC to 9 percent in the 7th NFC. However, the socio-economic indicators of the province are yet to improve considerably. The allocative efficiency of the provincial Public Sector Development Programme (PSDP) has remained quite low. For example, while education remains one of the main development challenges in Balochistan, its share in PSDP has declined overtime from 23 percent in 2014-15 to 14 percent in 2018-19. The allocation under PSDP should be informed by a prioritization exercise of the development challenges in the province. If such a process is used, health and education will emerge as the top priority sectors for resource allocation.