Mexico Raises Tariffs on Imports from India and China
Mexico’s Congress has approved a new law imposing higher import tariffs on goods originating from countries without free trade agreements, including India, China, South Korea, Thailand and Indonesia. The revised tariff structure will come into effect from January 2026, with duties ranging between 5 percent and 50 percent depending on the product category.
Key Products to Face Higher Duties
The tariff increase will impact a wide range of imports, including automobiles, auto components, textiles, clothing, plastics, steel and various manufactured goods. Most items will attract duties of up to 35 percent, while select categories will be taxed at the maximum 50 percent rate. The Mexican government has stated that the move is aimed at protecting domestic industries and reducing over-dependence on foreign suppliers.
Parliamentary Support and Opposition
The proposal received strong backing in the Mexican Senate, where 76 members voted in favour. However, some lawmakers voiced concern that higher tariffs could raise consumer prices and disrupt supply chains, particularly for industries reliant on imported intermediate goods.
Strategic Timing Ahead of USMCA Review
Supporters argue that the tariff hikes will strengthen Mexico’s economic position before the scheduled review of the USMCA (United States-Mexico-Canada Agreement). They believe the changes will help safeguard local manufacturing and employment. Critics, meanwhile, warn that the move could trigger inflationary pressures and strain trade relations with Asian exporting nations.
Likely Impact on India and China
India and China, both major exporters of automobiles, machinery and components to Mexico, are expected to be among the most affected. Analysts say companies may need to reassess supply chains or absorb higher costs depending on tariff classifications.
