Tariff Shock: Mexico's Move Jolts India's Export Market

Mexico's decision to hike import tariffs will significantly impact India's exports of automobiles, electronics, and chemicals. The new tariffs, effective January 2026, threaten India's price competitiveness in the Mexican market and disrupt established supply chains, potentially affecting economic relations between the two nations.

Mexico's recent decision to impose heightened import tariffs is set to have far-reaching consequences for India's export economy. Experts highlight that this move will primarily affect sectors such as automobiles, electronics, and chemicals, which represent a significant portion of India's trade with the South American nation.

The newly approved tariff regulations, set to take effect on January 1, 2026, will see duties ranging from 5% to 50% on goods from countries like India, China, and South Korea, which lack free trade agreements with Mexico. This shift poses a major challenge to India, whose exports to Mexico totaled USD 5.75 billion in the financial year 2025.

Industry insiders warn that the ripple effects could severely undermine India's competitiveness, disrupt existing supply chains, and strain economic relations. Particularly hit will be the automobile sector, with tariffs on passenger vehicles rising from 20% to 35%. Such measures mark a pivotal moment in the trade dynamics between Mexico and its partners.

(With inputs from agencies.)