India ‘engaged’ with Mexico over ‘unilateral’ tariff plan: Report

DAys after united mexican states imposed absorb tariffs on 1,400 products imported from republic of india and other asiatic countries, young Delhi is engaged with the South American nation over its “unilateral” decision, news agency PTI reported, citing an official.Track updates on Kerala local body pollsThe news agency quoted the official saying that India was engaged with Mexico during the initial tabling of a bill in this regard."The Department of Commerce is engaged with Mexico's Ministry of Economy to explore mutually beneficial solutions which align with global trade rules," the official was quoted as saying.Also read: Who is Satadru Dutta? Man behind Messi's India tour, now under scanner for mismanagementAccording to reports, a high-level meeting between commerce secretary Rajesh Agrawal and Mexico's vice minister of economy Luis Rosendo has already taken place and follow on technical meetings are likely to happen soon.The official said that India reserves the right to take appropriate measures to safeguard the interests of Indian exporters, while continuing to pursue a solution through constructive dialogue.Also read: 99% chance that Shivakumar will become Karnataka CM on January 6, Congress MLA claimsThe government official further said that the actual impact on Indian exports will depend on the criticality of Indian exports to domestic supply chains in Mexico and ability of Indian companies to secure exemptions or pass on the tariff cost to the Mexican consumers.India's exports to Mexico stood at USD 5.75 billion in 2024-25, while imports were USD 2.9 billion.Mexico's move to impose up to 50% tariffs on importsMexico Senate on December 11 approved a new tariff regime that raised duties, in some cases up to 50 per cent, on more than 1,400 products imported from countries that do not have a formal trade agreement with Mexico, one of which is India. Other countries impacted by the move include China, South Korea, Thailand and Indonesia.The Indian Embassy in Mexico had reportedly raised the issue with the Ministry of Economy on September 30, 2025 as it sought special concessions to shield Indian exports from the new tariffs.It is aimed at boosting manufacturing and reducing trade imbalances.Following the move, Mexico will impose staggering import tariffs - ranging from about five per cent to as high as 50 per cent on a range of goods (about 1,463 tariff lines) from countries that do not have free trade agreements with Mexico, including India, China, South Korea, Thailand and Indonesia.Also read: GRAP 4 enforced across Delhi-NCR as air quality worsensHowever, the list of items covered is yet to be officially notified. The higher duties will take effect on January 1, 2026."India values its partnership with Mexico and stands ready to work collaboratively toward a stable and balanced trade environment that benefits businesses and consumers in both countries," the official was quoted as saying.Additionally, India and Mexico are also looking to start negotiations for a free trade agreement, and terms of reference (ToR) to initiate the talks formally which are expected to be finalised soon.Experts said that the trade agreement will help insulate Indian companies from these tariffs, which were imposed under pressure from the US to align with America on increasing tariffs against China and prevent trans-shipment to America.Why tariffs impact India?India, which has sought to boost exports of textiles, auto components and engineering goods to Latin America, now faces a significantly more challenging entry into the Mexican market, the second-largest economy in the region and a key North American gateway. Indian exporters have long leveraged Mexico as a stepping stone to the US, thanks to its integration in North American supply chains.ALSO READ | Trump’s tariff signal worries Punjab basmati exportersThe tariff hikes threaten to hamper that advantage. Several Mexican import-dependent manufacturers have warned the government that higher duties on goods from India and other Asian nations will push up production costs and stoke inflation, according to agency reports.