Mexico has announced steep new import duties—up to 50%—on a wide range of goods coming from several Asian nations, including India and China. The move comes just four months after the United States introduced similar 50% tariffs on many Indian products.

The revised duties, designed to shield Mexican manufacturers and reduce dependence on foreign suppliers, will take effect on January 1, 2026.

According to reports in Mexican daily El Universal, the tariff list covers an extensive variety of items such as automobile components, small passenger cars, plastics, clothing, steel products, appliances, footwear, toys, textiles, furniture, leather items, paper and cardboard, motorcycles, aluminium goods, trailers, cosmetics, perfumes, and soaps.

The measures will affect countries that do not have trade agreements with Mexico—among them India, China, South Korea, Thailand and Indonesia.

WHY MEXICO IS RAISING TARIFFS

Mexico’s government says the decision is aimed at correcting its heavy import reliance on Asian economies, especially China, with which it has a sizeable trade deficit. Beijing, reacting to the move, criticised the hike and urged Mexico to reverse what it called an act of “unilateral protectionism.”

China stands to take the biggest hit, as it shipped goods worth $130 billion to Mexico in 2024.

Mexico also expects the higher duties to bring in an additional $3.8 billion in revenue. President Claudia Sheinbaum’s administration has framed the step as a push to bolster domestic industry and expand local production capacity.

“Supporting Mexican industry means creating employment,” said Deputy Ricardo Monreal, leader of the ruling Morena party in the lower house, as quoted by Mexico News Daily.

However, analysts quoted in El Financiero believe the timing and scale of the tariffs may be intended to align with US expectations ahead of the upcoming United States–Mexico–Canada Agreement (USMCA) review.

IMPACT ON INDIA

The tariff hike is expected to hit Indian exporters hard, particularly automobile manufacturers. According to Reuters, nearly $1 billion worth of Indian car shipments—by companies such as Maruti Suzuki, Hyundai, Nissan and Volkswagen—will face higher duties.

Under the new rules, import tax on vehicles will jump from 20% to 50%, posing a significant challenge for Indian carmakers. Industry bodies have already urged the Indian government to intervene diplomatically with Mexico.

Mexico is currently India’s third-largest overseas market for passenger vehicles, behind South Africa and Saudi Arabia.