The government recently released the report ‘Governance and Corruption Diagnostic [GCD] Assessment’ that it requested from International Monetary Fund (IMF) under ‘technical assistance’ in January, and which as per the structural benchmark of the ongoing Extended Fund Facility (EFF) programme it was required to make public by end-August.

Before getting into the details of the GCD report, the first thing to reflect upon is that the GCD report is ‘…based on a mutual appreciation of the macro-economic consequences of corruption and governance weaknesses in Pakistan.’ The problem here is that consequences alone will not allow for reaching proper diagnosis, or recommendations, and it is being assumed that causes of corruption were also investigated, although not explicitly indicated in the report.

Moreover, the research question being taken up as ‘…to identify governance challenges associated with increased exposure to corruption and define recommendations to improve performance, accountability, and integrity’ is wrongly unidirectional, since corruption and governance are correlated and, therefore, the direction of causation is two-way, that is lack of appropriate level of governance impacts corruption, and significant- level of corrupt practices, or corruption level impacts governance in a negative manner. Also, here the situation is like a chicken-and-egg situation because it is not clear whether it was firstly a rise in corruption level that resulted in poor governance, or the other way round.

The report points out that ‘GCD occurs within the context of a 37-month US$7 billion IMF Extended Fund Facility (EFF)’ programme, and that the programme has ‘…already delivered significant progress in stabilizing the economy and rebuilding confidence…’ This writer takes strong exception to the claim that the programme has had such a pronounced positive impact, and, on the contrary, the programme is based on strong neoliberal- and austerity-based policy framework, which as per deep research literature, especially in the aftermath of the Global Financial Crisis (GFC) 2007-08, indicates that such framework does not deliver any sustainable level of macroeconomic stabilization or builds resilience even after a lot of economic growth sacrifice.

As a consequences of these two policy inclinations, that is over-board aggregate demand squeeze policies, and a diminishing role of government – limited to mainly a ‘facilitator’ of private sector and only a ‘fixer’ of market failures, rather than government working actively with private sector, and market-shaping in a symbiotic, mission-oriented manner to enhance productive- and allocative efficiencies to put in place deep pre- and post-distribution policies for meaningfully inclusive, and well-distributed........

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