The tariff hikes will apply to imports from countries that do not have trade agreements with Mexico, such as China, India, South Korea, Thailand and Indonesia
The Mexican Senate on Wednesday (local time) approved a plan to raise import tariffs of up to 50 per cent next year on goods coming from China, India, and other Asian economies, a move aimed at shielding domestic manufacturers even as business groups and affected governments objected, Reuters reported.
The proposal, which the lower house had already approved, will either increase or introduce new duties, generally up to 35 per cent, from 2026 on a range of products, including vehicles and auto parts, textiles and garments, plastics, and steel.
The tariff hikes will apply to imports from countries that do not have trade agreements with Mexico, such as China, India, South Korea, Thailand and Indonesia.
Mexico’s Senate passed the bill with 76 votes in favour, 5 against and 35 abstentions, despite objections from China and domestic business groups.
According to the report, the approved bill is softer than the proposal that stalled in the lower house earlier this autumn. It covers approximately 1,400 tariff lines, primarily textiles, apparel, steel, auto parts, plastics, and footwear, and reduces duties on about two-thirds of the items compared to the original plan.
Citing analysts and industry representatives, the report states that the move is partly aimed at reassuring the US ahead of the next review of the United States-Mexico-Canada Agreement (USMCA). They also estimate it could raise an additional $3.76 billion next year as Mexico seeks to narrow its fiscal deficit.
India-Mexico trade volume
According to a report from the Embassy of India in Mexico City, the bilateral trade between the two countries has grown impressively in recent years, crossing the $10 billion mark. In 2022, two-way goods trade hit $11.4 billion, and although it dipped slightly in 2023 to $10.6 billion, it rebounded and hit an all-time high of $11.7 billion in 2024. India enjoys a significant trade surplus with Mexico; in 2024, India’s exports to Mexico were about $8.9 billion (a record high) against imports of $ 2.8 billion, resulting in a trade balance in India’s favour. This marked the eighth consecutive year that India has recorded a trade surplus with Mexico.
Mexico has emerged as one of India’s most important trading partners in the Americas. As of 2023, Mexico is India’s 2nd-largest trade partner in Latin America (after Brazil) and ranks among the top 10 globally for India. Conversely, India was Mexico’s 9th-largest trading partner worldwide in 2023. Bilateral trade has recovered strongly from the pandemic dip in 2020, driven by the diversification of traded goods and proactive trade promotion efforts.
India-US tariffs
India is already reeling under the 50 per cent tariffs from the US after President Donald Trump imposed an additional 25 per cent tariffs for India’s continued purchase of Russian crude oil, and accused New Delhi of funding Russian President Vladimir Putin’s war in Ukraine.
India currently has the largest US tariff in the world at 50 per cent, along with Brazil. While trade negotiations are underway, the progress is slow. Recently, Trump also indicated that Indian rice exports could also be hit with tariffs.
