Facing a steep tariff hike, India seeks a trade agreement with Mexico

Accelerated commercialized talks betwixt Mexico and India could beryllium connected the skyline aft steep caller tariffs that could deed India particularly hard were approved by some houses of the Mexican Congress.

The caller tariffs, meant to fortify Mexican manufacturing and trim commercialized imbalances, are aimed astatine countries without escaped commercialized agreements with Mexico. Besides India, those countries see China, South Korea, Thailand and Indonesia. 

Tariff bundle connected Asian imports volition support 350,000 jobs: Monday’s mañanera recapped

Despite attracting disapproval from concern groups, Mexico’s authorities expects the tariffs to bolster section manufacture and support employment.

The caller tariffs could beryllium arsenic precocious arsenic 50% and were said to beryllium introduced to appease the United States up of the reappraisal of a determination commercialized agreement, the USMCA, successful 2026. 

“Such steep duties volition erode our competitiveness and hazard disrupting proviso chains that person taken years to develop,” the Federation of Indian Export Organisations’ Director General Ajay Sahai stated.

The higher duties volition instrumentality effect connected Jan. 1, 2026.

In response, India is pushing for a escaped commercialized statement to debar astir US $2 cardinal worthy of Indian exports being taxable to the caller tariffs, Rajesh Agrawal, India’s commercialized secretary, said connected Monday.

“Mexico’s superior people is not to deed Indian exports,” Agrawal said. “India has engaged with Mexico to prosecute a commercialized statement to mitigate the interaction promptly.” 

According to Agrawal, Mexico and India person had preliminary method discussions connected specified a woody pursuing an online gathering betwixt Agrawal and Mexico’s Deputy Minister Luis Rosendo this month. 

In 2024, India exported $5.73 cardinal of goods to Mexico, portion Mexico exported $3.01 cardinal of products to India. Key exports included vehicles, basal metals, car parts and textiles. 

The interaction of car assemblage tariffs

Mexico’s caller tariffs are expected to beryllium particularly detrimental to India’s car sector, which exports astir $1 cardinal worthy of shipments to Mexico each year, with the import work connected cars expected to ascent from 20% to 50%. 

In November, the Society of Indian Automobile Manufacturers manufacture radical called for India’s Commerce Ministry to promote Mexico to “maintain presumption quo” connected tariffs for vehicles shipped from India to its third-largest car export market, according to a missive from an manufacture radical reviewed by Reuters.

“Indian-origin vehicles are not a menace to Mexican section manufacture arsenic Indian vehicles bash not cater to high-end segments manufactured by Mexico for serving the North American market,” the manufacture radical said successful its letter.

With reports from Reuters and The Economic Times