This Country Imposed a 50 Percent Tariff On India
Tariff: The US has already imposed a 50% tariff on imports of Indian goods. 25% of this tariff was imposed as a penalty for India’s purchase of oil from Russia. Now, Mexico has also announced a 50% tariff on goods from several Asian countries, including India.
The Mexican Senate has approved this measure. Mexico’s aim in increasing these tariffs is to strengthen its local industries. This decision will result in a 50 percent tariff on automobiles, auto parts, textiles, clothing, plastics, and steel. Tariffs on most other goods could also be increased to up to 35%.
However, the proposal passed by the Senate is slightly less stringent than the earlier draft, which had proposed increasing tariffs on approximately 1,400 import lines. The new proposal reduces duties on two-thirds of these items. Significantly, this step has been taken despite opposition from China and local business groups, indicating a shift in Mexico’s trade policy as it faces the upcoming United States-Mexico-Canada Agreement (USMCA) review, which will begin on 1st July 2026.
What is USMCA? The USMCA is a free trade agreement between the United States, Mexico, and Canada, which came into effect on 1st July 2020. According to Article 34.7 of the agreement, it must be reviewed every six years to ensure that it remains beneficial for all three countries. If the review is successful, it can be extended until 2036.
This move will strengthen domestic industries by reducing the pressure on local companies from cheaper imports, the Mexican government said. However, this will be a major blow to exporters and local business groups in those countries who were not expecting such a significant increase in tariffs. The increase in Mexican tariffs will significantly raise the cost of imports. This will particularly affect countries without a trade agreement with Mexico, such as China, India, South Korea, Thailand, and Indonesia.
