Mexico Imposes Up to 50 percent Tariffs on Asian Imports, Hits India and China

Mexico Unveils Major Tariff Hike on Asian Imports, Reshaping Global Trade Flows

Mexico has announced a sweeping tariff overhaul, imposing duties of up to 50% on imports from India, China and several other Asian economies. Approved by both houses of Congress, the new tariff structure will take effect on 1 January 2026 , signalling one of the most significant shifts in Mexican trade policy in recent years. The measures are expected to substantially alter supply-chain routes and impact exporters across multiple sectors.

Extensive Product Coverage Under New Tariffs

The tariff package spans over 1,400 product categories , including automobiles, auto components, textiles, electronics, plastics, steel, clothing and household appliances. India—without a free trade agreement with Mexico—faces immediate tariff exposure across industrial and consumer goods, affecting manufacturers dependent on the Latin American market.

Domestic Manufacturing and Trade Balance Concerns

Mexican authorities have defended the reform as necessary to protect domestic industry and stabilise trade imbalances. Policymakers argue that low-cost imports—particularly from China—have intensified competitive pressures on local factories, undermining Mexico’s production ecosystem across key manufacturing hubs.

US Influence and the USMCA Review Context

Analysts believe the move aligns closely with US strategic priorities , as Washington has urged Mexico to prevent Asian exporters from routing goods through Mexican facilities to evade American tariffs. The tariff overhaul also precedes the upcoming review of the US–Mexico–Canada Agreement (USMCA) , where supply-chain integrity and anti-circumvention concerns are expected to be central topics.

Regional Responses and Impact on Asian Exporters

China has sharply criticised the decision and has begun an official investigation into Mexico’s trade actions. Despite this, Chinese automakers continue expanding operations in Mexico, heightening US fears of indirect market entry. For India and other Asian exporters, the new tariff regime signals the need for recalibrated export strategies and broader supply-chain diversification.

Exam Point

• Mexico’s tariff reform covers 1,400+ product categories .

• Tariffs may go up to 50% starting January 2026 .

• Expected additional revenue: $3.76 billion .

• China has launched an investigation into Mexico’s trade measures.