In the wake of the pandemic, and the fast-unfolding of the climate change crisis has basically brought into focus the cracks in the supply chains globally. Such cracks have been created at the back of neoliberal policy, which made a comeback over the last four decades or so.

Previously, similar policies were being practiced before the Bretton Woods system, and the New Deal policies, as so-called ‘sound economics’.

Under both ‘sound economics’ and neoliberal policies, division of labour, and comparative advantage have been practiced by the powerful countries to unduly gain the advantage of trade in their favour.

In doing so, they have made the world firstly divided into the ‘first world’, and the rest, not to mention the particular coming into being of the ‘third world’, which was non-existent before the era of colonization, since countries in terms of per capita income were not significantly different from each other as such. To maintain this order after colonization, neoliberal policies were introduced, although after some delay caused by New Deal policies.

Hence, policies were sugar-coated in a way that efficiency was increasing in global trade, while lack of regulation of markets under neoliberal policies meant rising inequalities, since higher living standards were only for the rich few. That stoked uncertainty over the years, especially under largely free movement of capital that played havoc with any long-term planning for increasing resilience, as it mostly worked on the principle of short-term profit signals.

Moreover, lack of any deep domestic industrial base, including import substituting industry in developing countries in particular, meant that increasing frequency of financial crises – which was a rarity before the perpetuation of the neoliberal-minded globalization, and domestic policy, which favoured largely unregulated capital – and the existential threat of climate change crisis, and the associated ‘Pandemicene’ phenomenon lay bare the fragility of global supply chains in a world of polycrisis and highly sub-optimal preparedness of countries during these times, as was highlighted amply during the Covid pandemic.

From agricultural commodities to medical equipment to vaccines, the neoliberal model of globalization came down crashing, especially as the application of ‘disaster capitalism’ saw price gouging. Hence, neoliberalism has increased uncertainty, both on account of lack of market creation that had a lot more profit fairness, and one that internalized the need for creating resilience, and not just mainly follow profit signals.

In addition, practice of ultra-nationalism, for instance, as evidenced from deep practice of ‘vaccine nationalism’, has exposed the underlying fragile nature of globalization that propounded division of labour, and comparative advantage as the most important principle to be upheld.

Hence, practice of neoliberal policies as a miscalculation at best – although economic history of the last few centuries glaringly brings out intentional practice of these so called ‘sound economics’ policies to make a few countries, and some vested groups within countries rich while the rest were pushed to sub-optimal economic development – has continued to perpetuate uncertainty.

While it is important as a sufficient condition to shift domestic policy focus away from Neoliberalism, it is necessary to create some reasonable level of protectionism by countries to bring down uncertainty, especially in these times of polycrisis, and also to safeguard against the lopsided practice of globalization that makes it difficult for the ‘third world’ to decrease the distance between countries in terms of per capita income on one hand, and also to create much-needed greater sustainable macroeconomic stability, and economic growth, by reducing........

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