British voters would be "stark staring bonkers" if they chose to quit the European Union in an upcoming referendum on the UK's membership, Peter Mandelson has warned.
The Labour peer and former business secretary said that Britain would be left "whistling in the wind" in its free trade negotiations if it was no longer part of the European Union.
Countries like India would "just laugh in our faces" and "walk away" from negotiations if the UK chose not to operate as "a bloc with 500 million people behind us", Lord Mandelson argued in a debate at the British Chambers of Commerce' annual conference.
"We'd be stark staring bonkers if we turned our backs on the rich and open markets in the EU and walked out of the market on our doorstep," he added.
Speaking alongside the Labour peer, former Tory chancellor Ken Clarke said that countries in the eurozone would not take the "faintest notice of what the British government's position is" if it was outside of the European Union.
Clarke, who is a minister without portfolio in the coalition, said a British exit would not help "the slightest bit" any attempt to negotiate trade deals with Burma or Brazil.
Clarke poured scorn on the idea of Britain leaving the European Union and adopting a looser relationship based on trade links with the political blocs like Norway or Switzerland, branding it an "absurdity" and a "comic diminution of Britain's role in the world".
Others speaking alongside the pair, like City A.M editor Allister Heath, were more eurosceptic and argued that Britain would still be better off outside of the European Union.
"To me, the mainstream pro-EU case is far too defeatist. Britain's future is global" Heath said.
A post-debate poll of the audience found that two thirds of those present felt that Britain's future resided in staying part of the European Union, while only a third thought the opposite.
He said: "To walk away - or even talking of walking away - from our EU membership would be reckless, foolish and deeply damaging. It would be anti-investment, anti-jobs and anti-business."