Mexico has approved sweeping tariff hikes of up to 50 per cent on a wide range of imported goods from several Asian countries—including India, China, South Korea, Thailand and Indonesia—that do not have trade agreements with Mexico. The new duties, aimed at protecting domestic industries, will take effect on January 1, 2026.
The tariff list is extensive, covering products such as automobiles and auto parts, clothing, plastics, steel, furniture, footwear, leather goods, toys, textiles, motorcycles, appliances, paper, cardboard, aluminium, trailers, glass, soaps, perfumes and cosmetics, according to local media outlet El Universal.
This move comes four months after the United States raised tariffs on most Indian goods by 50 per cent, adding fresh uncertainty for exporters in Asia’s major manufacturing economies. Mexico says the new levies are intended to reduce dependence on imports—especially from China, with whom it faces a large trade imbalance. China, which exported $130 billion worth of goods to Mexico in 2024, is expected to be the hardest hit. Beijing criticized the decision, urging Mexico to reverse what it called “unilateral and protectionist” measures.
Mexican President Claudia Sheinbaum’s government argues the tariffs will both strengthen domestic production and generate an estimated $3.8 billion in new revenue. Officials say the measures will help protect jobs and give local manufacturers a competitive boost.
However, analysts suggest the tariffs may also be politically motivated—positioning Mexico more favourably ahead of the upcoming US-Mexico-Canada Agreement (USMCA) review.
The tariff hike is particularly damaging for India, whose auto exports to Mexico—worth about $1 billion annually—will face steep new costs. Import duties on cars will jump from 20 per cent to 50 per cent, affecting major exporters such as Volkswagen, Hyundai, Nissan and Maruti Suzuki.
Industry groups warn that the decision will severely undermine India’s competitiveness in one of its largest markets. Mexico is India’s third-biggest destination for car exports, behind South Africa and Saudi Arabia. In a letter to the Indian commerce ministry, auto manufacturers urged the government to intervene and open discussions with Mexico to mitigate the impact.
