Mexico Slaps Up To 50% Tariffs On India And Asia: What’s Driving The Protectionist Push?

Mexico has approved a sweeping tariff hike that will directly affect imports from India, China, South Korea, Thailand, Indonesia and several other Asian economies. 

The move, passed by the Mexican Senate on Wednesday (local time), paves the way for duties as high as 50 per cent on a wide range of products starting next year, a protectionist shift that has triggered concerns among global exporters and domestic industry groups alike.

The measure, already cleared by Mexico’s lower house, aims to shield the country’s manufacturers from low-cost imports. According to Reuters, the tariff overhaul introduces or raises duties, generally up to 35 per cent, with certain lines reaching 50 per cent, on sectors such as vehicles, auto components, textiles, garments, steel, plastics and footwear.

The tariffs apply only to countries that do not have a trade agreement with Mexico. India, like China and many Southeast Asian economies, falls squarely within this category.

A Narrow Vote, A Broad Impact

The Senate voted 76 in favour, 5 against, and 35 abstained, pushing the bill through despite clear objections from China and local business associations. Analysts noted that this approved version is softer than an earlier proposal that stalled in Mexico’s lower chamber. Even so, it still covers nearly 1,400 tariff lines, targeting major Asian exporters.

Industry watchers told Reuters that the move appears to be partly aimed at strengthening Mexico’s position before the upcoming review of the United States‑Mexico‑Canada Agreement (USMCA). By tightening import controls, Mexico may be signalling alignment with Washington’s unease over Asian import dominance.

Economists estimate the tariff regime could generate an additional $3.76 billion in revenue next year, helping Mexico narrow its fiscal deficit.

India-Mexico Trade: Strong, Growing, And Now Facing A New Test

According to the Embassy of India in Mexico City, bilateral trade has seen a sharp rise over the past decade, crossing the $10 billion threshold and maintaining strong momentum. The trade reached $11.4 billion in 2022, $10.6 billion in 2023, and hit an all-time high of $11.7 billion in 2024. 

India enjoys a consistent trade surplus with Mexico. In 2024, Indian exports reached $8.9 billion, versus imports of $2.8 billion, marking the eighth consecutive year of surplus.

Mexico is now India’s second‑largest trade partner in Latin America (after Brazil) and one of its top 10 partners globally. Likewise, India ranked as Mexico’s ninth‑largest trading partner worldwide in 2023.

This tariff shift could therefore reshape long‑standing trade linkages at a time when bilateral cooperation is otherwise on an upward trajectory.

India Already Under Pressure From US Tariffs

Mexico’s tariff announcement comes as India is still navigating the economic strain of the 50 per cent US tariffs imposed earlier by the Donald Trump administration. The US had added a further 25 per cent surcharge on India’s exports, alleging that New Delhi’s purchase of Russian crude indirectly funded Moscow’s war in Ukraine.

India and Brazil now face the highest US tariff rates in the world. Negotiations are underway, but progress remains slow. Trump has also hinted that rice exports from India may face tariff barriers next.

What Mexico’s Tariffs Could Mean For India

Although the Indian government has not yet issued a formal response, the new Mexican tariff regime could raise costs for Indian exporters in auto parts, textiles, plastics, steel and engineered goods and push Indian firms to evaluate alternative markets or consider on‑ground manufacturing in North America. The duties could also influence discussions around future India–Mexico trade frameworks.

For now, the tariff proposal has introduced fresh uncertainty into a bilateral relationship that has otherwise seen steady, broad‑based expansion.