Highlights:
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Mexico approves a major tariff overhaul covering 1,463 product categories
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New import duties of 5% to 50% will apply from January 1, 2026
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Measures target countries without free trade agreements, including India, China, Brazil, South Korea, South Africa, and the UAE
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China faces the largest overall impact under the new tariff framework
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Mexico expects USD 3.8 billion in additional annual revenue
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Reform aligns Mexico more closely with evolving US protectionist trade policies
Mexico has approved a broad tariff reform that will raise import duties on goods coming from nations without free trade agreements with the country. The legislation covers imports from India, China, Brazil, South Korea, South Africa, the United Arab Emirates, and several others. After securing backing in the lower house, the Senate approved the measure on Wednesday, moving the bill toward implementation on January 1, 2026.
The decision comes at a time when global trade policies are shifting toward higher protectionism. The move follows recent actions by the United States, including President Donald Trump’s August announcement of a 50 percent tariff on Indian goods entering the US and a 25 percent tariff on India’s purchases of Russian oil.
Mexico Expands Tariff Coverage to 1,463 Product Categories
Submitted in September by President Claudia Sheinbaum, the approved legislation revises 1,463 tariff lines across more than a dozen industrial sectors. According to reporting by Mexico News Daily, the new tariff structure will apply to a long list of industries including:
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Auto parts and light vehicles
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Plastics and toys
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Textiles and clothing
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Footwear
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Furniture
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Aluminum and glass
Under the plan, Mexico will apply duties ranging from 5 percent to 50 percent, depending on the category. The broadened scope reflects the government’s intention to discourage reliance on non-FTA imports and to reinforce local production.
Mexico’s Tariff Policy Will Hit China the Hardest
Among the impacted countries, China is expected to face the most significant economic consequences. Officials in Mexico have stated that the policy aims to reduce the country’s heavy dependence on Asian imports, especially from China, which has become a major source of manufactured goods in Mexican supply chains.
Government estimates suggest the new tariff structure will bring in USD 3.8 billion in additional revenue per year.
Mexico Strengthens Trade Alignment With the United States
The reform also reflects closer alignment between Mexico and the United States on trade strategy. Mexican diplomat Horacio Saavedra told La Silla Rota that the initiative responds to shared concerns about competitive pressures faced by domestic industries.
“The measure responds to the shared concern of Mexico and the U.S. about practices that have harmed national industries, especially textiles, clothing, and certain manufacturing sectors,” Saavedra said.
Analysts view the decision as consistent with Washington’s growing focus on tightening rules around supply chains, market access, and foreign competition—particularly from Asian economies.
Mexico’s New Tariffs and Their Impact on India-Mexico Trade
India ranked as Mexico’s ninth-largest trading partner in 2023, with bilateral trade totaling USD 10.58 billion. Indian exports to Mexico amounted to USD 8.03 billion, while imports from Mexico reached USD 2.54 billion.
India’s primary exports to Mexico include:
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Automobiles and auto parts
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Pharmaceuticals
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Engineering goods
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Chemical products
Meanwhile, Mexico’s main exports to India are crude oil, gold and jewelry, chemical compounds, and telephone machinery.
The new tariff structure is expected to reshape trade volumes, prompting businesses on both sides to reassess supply chains and prepare for changes taking effect in 2026. Companies operating in the autos, chemicals, electronics, and consumer goods sectors are expected to monitor Mexico’s implementation closely as they adjust sourcing and compliance strategies.
