English
English
English
Mexico has stunned global markets with tariffs of up to 50% on Asian imports, hitting India hard and reshaping North American supply chains. Why this sudden protectionist turn and what it means for exporters?
Mexico announces up to 50% tariffs on India, other Asian nations
New Delhi: Mexico has approved sweeping new tariffs on more than 1,400 products from countries without a free-trade agreement, marking one of its most significant protectionist moves in recent decades.
The decision passed by the Senate with 76 votes in favour, five against and 35 abstentions affects major Asian exporters including China, India, South Korea, Thailand and Indonesia.
The new regime, reported by Reuters, introduces duties as high as 50%, though most items will fall under a 35% bracket. The tariffs apply to a broad swath of industrial inputs and consumer goods, from automobiles and components to textiles, apparel, plastics, metals and footwear. They will begin rolling out in 2025 and expand through 2026.
It was for slaves not rich: Trump ends birth right citizenship in the US; Full story here
For India which has been deepening trade ties with Latin America—the tariff hike poses new challenges:
Reduced competitiveness for Indian textiles, leather products, auto parts, engineering goods and steel.
Higher landed costs for Indian firms using Mexico as a North American manufacturing or supply-chain base.
Potential disruption of export strategies that relied on Mexico as a gateway to the US market due to its integration with North American value chains.
Several Mexican manufacturers have already expressed concern that the duties will raise production costs and feed inflation. India’s Commerce Ministry has yet to comment.
Analysts believe Mexico’s abrupt protectionist turn is closely linked to upcoming political and trade pressures from the United States. With a review of the USMCA (United States-Mexico-Canada Agreement) scheduled next year, Mexico is thought to be signalling alignment with Washington’s tougher stance on Chinese goods.
The new rates will apply to a wide swath of consumer goods
President Claudia Sheinbaum has denied that the tariffs were influenced by US demands. However, the structure of the new duties closely mirrors American trade measures targeting China, according to Bloomberg.
The final bill is a softened version of an earlier proposal that imposed heavy tariffs across nearly all 1,400 categories. Lawmakers have eased rates on roughly two-thirds of those lines, but the finance ministry still expects to collect nearly 52 billion pesos (₹19,000 crore) in added revenue next year funds intended to help narrow the fiscal deficit.
Reactions across Mexico’s political and business landscape have been divided:
Concerns over consumer impact: Opposition senator Mario Vazquez warned that while certain industries may benefit, the tariffs effectively act as a tax on consumers and questioned how the additional revenue will be allocated.
Support from ruling bloc: Morena lawmaker Emmanuel Reyes said the move would strengthen Mexico’s position in global value chains and safeguard domestic jobs.
Donald Trump threatens India with new tariffs amid India-Russia ties; Click for details
Strong backing from auto industry: Local auto manufacturers, alarmed by the rapid rise of Chinese car imports now 20% of Mexico’s market, up from almost zero six years ago support the steepest 50% duties on imported vehicles.
The legislation grants Mexico’s Economy Ministry broad powers to adjust tariffs on non-FTA countries without returning to Congress. This new flexibility, especially in the run-up to the USMCA review, could lead to frequent shifts in duty structures posing ongoing uncertainty for exporters from India and across Asia.
With both the US and Canada tightening oversight of Chinese supply chains, Mexico’s move signals a deeper regional turn toward protectionism and could reshape trade flows across North America in the years ahead.
