India, Mexico Eye Trade Pact to Mitigate Tariff Impact

• India and Mexico are discussing a preferential trade agreement to mitigate the impact of new tariffs.
• Mexico approved tariff hikes (5-50%) on select products from non-FTA countries, including India, effective 2026.
• The tariffs are estimated to affect around $2 billion of Indian exports, including automobiles, textiles, and auto parts.
• Mexico's tariff increase is seen as aligning its trade policy with US protectionist measures and supporting near-shoring.
• Bilateral merchandise trade between India and Mexico totaled $8.74 billion in 2024, with India holding a trade surplus.

Why It Matters: Mexico's tariffs threaten Indian exports, prompting trade talks.