America has imposed 50% tariff on Indian imports. Now, another country has joined the list of countries imposing tariffs. According to a Reuters report, on Wednesday the Mexican Senate approved tariffs of up to 50% on goods imported from India, China and several other Asian countries.
These tariffs will go into effect on January 1, 2026, and will impose tariffs of up to 50% on goods such as automobiles, auto parts, textiles, plastics and steel coming from countries that do not have a trade agreement with Mexico. This means that countries like India, South Korea, China, Thailand and Indonesia will be affected. This decision has also been taken because the country wants to generate additional $3.76 billion (approximately ₹33,910 crore) revenue next year.
Why did Mexico impose tariffs?
This decision comes at a time when Mexican President Claudia Sheinbaum is trying to boost domestic production. However, analysts say this move is an attempt to appease Trump ahead of the US review of the US-Mexico-Canada Agreement (USMCA). America is Mexico’s largest trading partner.
This new tariff decision comes after Mexico increased tariffs on Chinese goods earlier this year. However, Trump has been continuously expressing concern and has been continuously criticizing the Sheinbaum government for the last few months. In recent weeks, Trump has threatened to impose 50% tariffs on Mexican steel and aluminum. He has also threatened to impose an additional 25% tariff if it fails to stop the flow of opioid fentanyl into the US. Earlier this week, Trump threatened Mexico with another 5% tariffs and accused it of violating a 1944 agreement that gives water to American farmers.
How will the tariffs affect India?
Mexico’s move to impose tariffs of up to 50% on some goods is likely to hit bilateral trade, which was projected to reach a record $11.7 billion in 2024. India is the ninth largest export destination for Mexican goods. Currently, India has a significant trade surplus with Mexico. According to a report, India’s exports to Mexico in 2024 were approximately $8.9 billion, while imports were $2.8 billion, resulting in a favorable trade balance for India. In 2024, India imported mainly motor cars, auto parts and other passenger vehicles from Mexico. Now that Mexico is imposing heavy duty on these things, imports may be affected in the coming year.
