Influence of Mexico’s Tariff Improve on India’s $5.7 Billion Exports

Mexico introduced tariffs on nations it doesn’t have a commerce take care of, together with India. (Reuters/File)

Mexico has imposed as much as 50% tariffs on imports from non-preferential commerce companions, together with India, with impact from January 1, 2026, the 2 nations have began discussions for a free-trade settlement (FTA). Analysts stated the important thing targets of the South American nation’s unilateral determination to lift tariffs are autos, auto elements, textiles, attire, plastics, metal, metals and footwear.

Underneath the choice, Mexico will impose steep import tariffs – starting from about 5 per cent to as excessive as 50 per cent on a variety of products (about 1,463 tariff strains) from nations that would not have free commerce agreements with Mexico, together with India, China, South Korea, Thailand and Indonesia. Nevertheless, the listing of things coated is but to be formally notified. The upper duties will take impact on January 1, 2026.

Jahol Prajapati, analysis analyst at SAMCO Securities, stated, “Mexico’s Senate has cleared a protectionist tariff package deal imposing 5–50% duties on greater than 1,400 import strains from nations with out FTAs, together with India, efficient 1 January 2026. Autos, auto elements, textiles, attire, plastics, metal, metals and footwear are key targets; most merchandise will cluster across the 35% slab, however passenger car responsibility will leap from 20% to 50%. India exported items price about 5.7 billion US {dollars} to Mexico in FY202425, with autos contributing roughly one-third.”

He added that Indian automotive exports to Mexico, primarily from Volkswagen/Skoda, Hyundai, Maruti Suzuki and Nissan, face a direct affect, threatening volumes and margins in a market that accounts for about 9% of India’s international car exports. Past autos, elevated tariffs on engineering items, electronics and metals danger demand compression, although some specialised Indian merchandise with robust market share might even see price-led, not volume-led, harm.

Mexico’s Senate has authorized a brand new tariff measure on December 11, 2025, and it has since been cleared by each chambers of Congress. It’s aimed toward boosting manufacturing and lowering commerce imbalances.

India, the truth is, was engaged with Mexico in the course of the preliminary tabling of a invoice on this regard. The Embassy of India in Mexico raised the difficulty with the Ministry of Financial system on September 30, 2025, itself, in search of particular concessions to protect Indian exports from the brand new tariffs.

Each the nations want to begin negotiations for a free commerce settlement, and phrases of reference (ToR) to provoke the talks formally are anticipated to be finalised quickly.

Specialists stated that the commerce settlement will assist insulate Indian corporations from these tariffs, which had been imposed underneath stress from the US to align with America on rising tariffs in opposition to China and forestall transhipment to America.

India’s exports to Mexico stood at $5.75 billion in 2024-25, whereas imports had been $2.9 billion.