Mexico Imposes 50% Tariffs on India, $1 Billion Exports at Risk

Mexico has approved the imposition of up to 50% tariffs on certain products imported from Asian countries, including India and China, just after the four months of the 50% tariffs from the US on most of the Indian goods. The tariffs are set to protect the national industry and producers and are ready to come into effect from January 1, 2026.

According to El Universal, a Mexican daily, Mexico has imposed tariffs on goods, including auto parts, light cars, clothing, plastics, steel, household appliances, toys, textiles, furniture, footwear, leather goods, paper, cardboard, motorcycles, aluminium, trailers, glass, soaps, perfumes and cosmetics.

The tariffs imposed will have an impact on the countries that do not have a trade deal with Mexico, like India, South Korea, China, Thailand and Indonesia.

Must Read: Recession in India: Is India Heading Towards One in 2026?

Why are These Tariffs Being Imposed on Asia by Mexico?

The Mexican government wants to reduce its dependence on imports from Asian countries, especially China, because it has a large trade imbalance with them. Meanwhile, on Thursday, China urged Mexico by saying, "It has always opposed raising tariffs on its own and Mexico should stop its unfair practices of acting alone and using protectionist measures as soon as possible".

China will be the most affected country, as Mexico imported $130 billion worth of products from China in 2024. The proposed tariffs are expected to raise an additional revenue of US$3.8 billion (about Rs 33,910 crore).

According to a news channel in Mexico, the leader of Morena, Deputy Ricardo Monreal, stated in the Chamber of Deputies that, "Mexican President Claudia Sheinbaum wants to protect the country's industries and increase domestic output. She believes that supporting Mexican businesses will create more jobs".

Analysts believe the tariffs are meant to please the US before the review of the United States-Mexico-Canada Agreement, according to the Mexican economic news outlet El Financiero.

What will be the Impact of These Tariffs on India?

Mexico is India's third-largest car export market after South Africa and Saudi Arabia.

Based on the report by Reuters, the Mexican tariffs will impact $1 billion worth of exports or shipments from major Indian car exporters, such as Volkswagen, Hyundai, Nissan and Maruti Suzuki.

The import duty on cars will increase from 20% to 50%. This change will significantly impact India's largest vehicle exporters.

Before the tariff was finalised, the industry body said in its letter to the commerce ministry, "The proposed tariff increase will likely have a direct effect on Indian automobile exports to Mexico. We ask the Government of India to work with the Mexican government on this issue".

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