Mexico approves tariff hikes of up to 50% on goods from India, others

Mexico on Wednesday approved tariff hikes of up to 50% on hundreds of goods imported from countries, including India, that it does not have a free trade agreement with, Reuters reported.

The proposal, which was passed by the Senate, will raise duties or impose new levies from April on goods such as automobiles, automobile parts, textiles, clothing, plastics and steel.

A tariff of up to 35% will be imposed on the majority of the products. The other countries that will be impacted by the tariffs include China, South Korea, Thailand and Indonesia.

The Mexican government said that the decision was aimed at protecting local employment and manufacturing, the Hindustan Times reported. Another reason was to contain the flooding of the country’s market by Chinese goods, India Today reported.

The tariffs have been in place since April 2024 and the proposal approved on Wednesday was an extension of the original decision, The Hindu reported.

At the time, Mexico had imposed tariffs ranging between 5% to 50% on items imported from countries it did not have a free trade agreement with, including India, for a two-year period.

The tariffs imposed on Wednesday will not have a material impact on India’s overall export picture, The Hindu reported. However, it could continue to impact particular sectors such as automobiles.

India exported $5.7 billion worth of goods to Mexico in 2024-’25, making it about 1.3% of its total exports during that period, according to the newspaper. This showed that hike in tariffs was unlikely to pose a significant threat to India’s overall exports.

Mexico’s decision came amid the United States having imposed a combined tariff rate of 50% on India. A 25% so-called reciprocal duty was imposed on August 7, followed by an additional 25% punitive levy on August 27.

The punitive tariffs were introduced as part of US President Donald Trump’s pressure campaign against countries purchasing discounted oil from Russia amid Moscow’s war on Ukraine.

After the punitive levies were announced, New Delhi had said it was “extremely unfortunate” that the US had chosen to impose additional tariffs on India “for actions that several other countries are also taking in their own national interest”.

However, trade talks between the two countries have gained fresh momentum in recent months.

On Thursday, Union minister Piyush Goyal said that the US should sign the trade agreement with India if it is happy with the offers that New Delhi has made.

He was commenting on US Trade Representative Jamieson Greer’s statement on Tuesday that New Delhi’s offers “have been the best” Washington has ever received.