What will be the impact of 50 percent tariff imposed by Mexico on India
Mexico's parliament has increased tariffs to up to 50 percent on goods from countries with which it does not have a free trade agreement (FTA).
This Mexican tariff increase will affect exports from several Asian countries, including India, China, Thailand, and Indonesia.
Exports from these countries to Mexico will now become more expensive.
Blow to India's car exports
The increase in tariffs on cars exported from India, from 20 percent to 50 percent, will impact exports by Volkswagen, Hyundai, Nissan, and Maruti Suzuki.
These are the companies that export the most cars from India to Mexico. After South Africa and Saudi Arabia, Mexico is the largest market for Indian cars.
The Society of Indian Automobile Manufacturers (SIAM), a representative body of the Indian automotive industry, had requested the Ministry of Commerce to ask Mexico to maintain the current tariff rates on cars exported from India.
During the 2024-25 financial year, India exported goods worth $5.3 billion to Mexico, of which approximately $1 billion (Rs 9,000 crore) was accounted for by cars.
Approximately 50 percent of the total cars sent from India to Mexico are from Skoda Auto.
Hyundai exported cars worth $200 million, Nissan $140 million, and Suzuki $120 million to Mexico.
Tariffs will apply to metals, textiles, and other household goods besides cars
The new tariffs announced by Mexico will come into effect on January 1, 2026. These tariffs will apply to cars, as well as metals, textiles, and other household goods.
Mexico has imposed tariffs ranging from 5 to 50 percent on goods from Asian countries. About 1,400 items imported from Asian countries to Mexico are covered by these tariffs.
China has stated that these tariffs imposed by Mexico will significantly harm its trade interests.
Mexico is currently engaged in trade negotiations with the United States.