Intensification of tariff wars, rise of protectionist policies to disrupt global supply chains says FM

Union Finance Minister Nirmala Sitharaman discusses global trade challenges, Indian economic strength, and the growth of capital markets.

The intensification of tariff wars and the rise of protectionist policies have the potential to disrupt global supply chains, increase production costs and create uncertainty in investment decisions across borders as well, Union Finance and Corporate Affairs Minister Nirmala Sitharaman said on Thursday.

“This has had a ripple effect on the financial markets across the globe and including our own market,” she said while speaking at function organised by the BSE to celebrate its 150 years of existence in Mumbai.

“We recognise that the global landscape is changing and changing rapidly and the world is going through a phase of trade calibrations. The recalibration efforts on trade are very, very challenging. It is not worrisome, but it is also going to be very challenging,” she emphasized.  

Talking about a familiar acronym called VUCA she said “It is a VUCA world. It is full of volatility, uncertainty, complex and ambiguous paradigms which are shifting every day.”

“One thing stands firm, the strength of the Indian economic fundamentals and the macroeconomic prudence with which the economy has been managed,” she added. 

She said India was confident of navigating these global disruptions with policy agility and long term vision. “Our focus remains firmly on building robust domestic foundation and the foundation is laid and strengthened through infrastructure development, inclusive growth and deeper regional cooperation,” she said. 

“These are not just buffers to external shocks but accelerators for our long term growth aspirations,” she stated.