Mexico Imposes Steep Tariffs on India, Boosts Duties on 1,400 Products
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Mexico has taken a significant step towards protectionism by imposing steep tariffs on a wide range of imports, including goods from India. The move, which affects over 1,400 products, includes up to 50% duties on items such as textiles, automobiles, and metals. According to reports, Mexico's Senate approved the new tariff regime, which targets countries without a formal trade agreement with Mexico. India, along with China, South Korea, Thailand, and Indonesia, are among the key nations affected by the move. The new duties will come into effect next year and will be in place until 2026. While some products will face the maximum 50% duty, most are expected to fall under the 35% bracket. Indian exporters, who have long leveraged Mexico as a stepping stone to the US market, now face a significantly more challenging entry into the Mexican market. Analysts believe that Mexico's sudden protectionist turn is closely tied to pressure from the United States ahead of the USMCA review. The move is expected to bring in nearly 52 billion pesos in additional revenue next year, which the government says it needs to narrow its fiscal deficit. The Mexican finance ministry has defended the move, arguing that it will strengthen Mexican products in global supply chains and protect jobs in priority sectors. However, opposition lawmakers have expressed concerns that the tariffs will act as a tax on consumers and stoke inflation. The implications for India are significant, as the tariff shift could reduce competitiveness in industries such as textiles, leather goods, auto parts, and steel. Indian exporters may need to reconsider supply-chain routing through Mexico, which could increase landed costs and push companies to explore alternative markets. The move underscores a broader North American shift towards protectionism, with the US and Canada tightening scrutiny on Chinese supply-chain routing. As the USMCA review approaches, Mexico's decision to impose steep tariffs on India and other Asian nations is likely to have far-reaching consequences for trade and commerce in the region.
