Traditionally, Pakistan has been infamously called a ‘one-tranche’ country, which although is correct in the context that it has left International Monetary Fund (IMF) programmes after receiving a few initial tranche disbursements, apparently so that it has to comply with least amount of reform conditionalities, yet whether in or outside of the IMF programmes, the country has continued to adopt neoliberal policies – and underlying austerity-based mindset – which constitute the bread and butter policy framework of IMF.

While on the face of it the above statement indicates a contradiction that what was the basis of reluctance of the country because of which it had to leave the IMF programme, when even after leaving the programme, it continued with neoliberal policies? There is no contradiction here since all governments under IMF programmes found it useful to adopt, firstly, market fundamentalism and secondly, austerity, or fiscal consolidation, or aggregate demand squeeze policies since they enabled the government to deal with macroeconomic instability, including safeguarding against debt default– although in the sense of pushing the can down the road – by not taking up reforms on the aggregate supply side like lowering transaction costs and information asymmetries since those dented the extractive institutional design of political-, and economic elites – and disturbed their rent-seeking collusion – and also allowed vested interest groups in markets that favour elitist interest like financing election campaigns, or directly allowed benefit to elites in their business and power interests to ride the profit wave under the (wrong) mantra of ‘market knows best’ because that satisfied their profit motives, although at the cost of economic resilience in terms of sub-optimally reaching productive-, and allocative........

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