India has taken up Mexico&rsquo;s decision to sharply raise import tariffs on a wide range of products, a move that could significantly hit Indian exporters from January 1, 2026. The unilateral measure targets countries without a free trade agreement with Mexico and covers over 1,400 tariff lines, including automobiles, auto components, textiles, apparel, plastics, metals and footwear.
Under the new regime, import duties will range from 5 per cent to as high as 50 per cent, with passenger vehicle tariffs set to jump from 20 per cent to 50 per cent. Analysts warn that automobiles and auto parts will face the steepest impact, as Mexico is a key overseas market for Indian carmakers. Vehicles alone account for nearly one-third of India&rsquo;s exports to Mexico, a market that represents about 9 per cent of India&rsquo;s global automobile shipments.
&ldquo;Mexico&rsquo;s Senate has cleared a protectionist tariff package imposing 5&ndash;50 per cent duties on over 1,400 import lines from countries without FTAs, including India, effective January 1, 2026,&rdquo; said Jahol Prajapati, Research Analyst at SAMCO Securities. He cautioned that higher tariffs could compress demand and margins for Indian exporters, especially in automobiles, engineering goods and metals, even as niche products may face pricing pressure rather than volume loss.
India has been engaging Mexican authorities since the proposal was first introduced, seeking safeguards for its exporters. With both countries preparing to formalise negotiations for a free trade agreement, officials see the FTA as the most viable route to insulating Indian businesses from the tariff shock. India&rsquo;s exports to Mexico stood at $5.75 billion in 2024&ndash;25, compared to imports of $2.9 billion, underlining the stakes involved in the evolving trade talks.

Unilateral tariff hike threatens Indian exports as New Delhi pushes for FTA talks

Mexico’s Tariff Shock for India

Unilateral tariff hike threatens Indian exports as New Delhi pushes for FTA talks

December 14, 2025 | 12:03 IST