Chidambaram hits out at centre, warns of ‘tariff and trade wars’

Former finance minister P. Chidambaram urged India to oppose tariff and trade wars on Thursday. He demanded the Union government clarify its response to US President Donald Trump’s tariff threats.

Speaking during the Finance Bill debate in the Rajya Sabha, Chidambaram questioned recent customs duty cuts on items like motor vehicles and toys. He linked the reductions to pressure from Trump. “Is this a genuine change of heart? I don’t think so. This is the Trump Effect,” he said, accusing the government of bowing to US pressure.

Chidambaram warned that Trump plans to start a reciprocal tariff war on April 2. He asked how the Modi government would respond if the US imposes tariffs. “It will wreck the world economy and ruin developing nations. A tariff war will reduce exports, lower FDI, increase inflation, and weaken the currency,” he said.

He criticized the government for avoiding parliamentary discussions and ignoring Opposition concerns. Chidambaram urged India to join nations like Canada, Britain, France, Germany, and Japan in opposing a tariff war. “India must stand with saner voices to prevent this disaster,” he stressed.

Highlighting economic challenges, Chidambaram accused the government of worsening the situation. He pointed to rising unemployment, inflation in essential sectors, stagnant wages, and falling consumption. He also blamed the government for increasing household debt and cutting spending on social welfare.

“The government has mercilessly slashed funds for health, education, agriculture, and rural development,” he said, accusing the Centre of neglecting public welfare.

Earlier, Finance Minister Nirmala Sitharaman introduced the Finance Bill, 2025, in the Rajya Sabha. The Lok Sabha had already passed the bill on Tuesday.

As Trump’s tariff deadline nears, Chidambaram’s warning adds pressure on the Modi government to address the looming economic threat.