After America, now Mexico has given a big blow to India. The Mexican Parliament has approved a new bill, under which heavy tariffs ranging from 5% to 50% will be imposed on goods imported from countries including India, China and Brazil. This law will apply to countries with which Mexico does not have a Free Trade Agreement (FTA)—which includes India. This new tariff structure will be applicable from January 1, 2026.
Mexican Parliament passes high-tariff bill
Both houses of the Mexican Parliament—the Senate and the Lower House—have approved the bill. President Claudia Sheinbaum introduced it in September, in which it was proposed to increase import duty on 1,463 products.
Which products will become more expensive? The sectors where tariffs have been increased under this law include:
automotive components
light vehicles
plastic products
toys
Textile and clothing
Furniture
footwear
ready-made clothes
aluminum product
glassware
Tariffs ranging from 5% to 50% may be imposed on all these categories.
Why will this affect India?
India does not have an FTA with Mexico, so this law will directly apply to Indian exports. In 2023, India was Mexico’s 9th largest trading partner, and bilateral trade between the two countries totaled $10.58 billion. This means that many products sent from India will now become more expensive in Mexico, which may affect the competitiveness of Indian companies.
Biggest impact on China, but impact on India too
The government estimates that this move will generate $3.8 billion in additional revenue for Mexico every year. While China will have the biggest impact on exports, India is also one of the major countries that will be affected by this new law.
America also took a similar step
In early August, America had increased the custom duty on many products imported from India to 50%. This decision of Mexico may further increase the pressure on Indian trade.
