The process is as follows :

1° the wasp digs a hole in soft ground

2° it paralyses a caterpillar (some other species use different worms, or beetles, as their victims; but each species of wasp targets one precise species of caterpillar or bug and cannot use any other food source for its larvae than the one it's genetically programmed to catch).

3° it carries the caterpillar into the hole

4° it lays its egg on the caterpillar, far from the head

5° it closes the hole with dirt

6° the egg hatches in the dark, and the larva feasts on the paralysed caterpillar, eating it alive.

If you pull out the caterpillar while the wasp turns around to lay its egg, it doesn't interrupt itself. IIRC even if you take the caterpillar while it's flying to the hole, it still proceeds to the end, without the caterpillar (which makes no sense at all, showing it's a purely reflex activity, without any intelligence).

Se for instance https://www.gutenberg.org/ebooks/3462

(Jean-Henri Fabre was a marvellous writer, and the English translation is very good).