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India-Mexico Trade Pact Targets Autos, Pharma, Engineering Growth
India and Mexico are discussing a trade agreement that could make business between them easier.
They may sign an initial plan called the Terms of Reference in early October.
The agreement could cover products, customs rules, safety standards and ways to settle disagreements.
Cars and car parts are important products that India sells to Mexico.
Medicines, engineering products and chemicals may also gain better access to the Mexican market.
However, Mexico is planning high tariffs on many imports from January 1, 2026.
Those tariffs could make some products from India more expensive.
India’s foreign minister also said trade between India and Latin America has room to grow.
India and Mexico may sign Terms of Reference for a proposed preferential trade agreement in early October.
The proposed pact could address goods, market access, rules of origin, customs, trade remedies, regulatory measures and dispute settlement.
Automobiles, auto parts, pharmaceuticals, engineering goods and chemicals are the main sectors expected to benefit.
Mexico’s tariffs of up to 50% on more than 1,400 imports from January 1, 2026, could increase costs for exporters from India.
Trade between India and Mexico totaled $7.83 billion in 2025-26, including $5.73 billion in exports and $2.11 billion in imports.
- Who
- India and Mexico are discussing the proposed trade agreement; Commerce Minister Piyush Goyal or Commerce Secretary Rajesh Agrawal could represent India at the signing.
- What
- The countries may sign Terms of Reference for a proposed preferential trade agreement covering trade and market-access rules.
- Where
- The agreement concerns trade between India and Mexico, while related comments were made at the India–Community of Latin American and Caribbean States Foreign Ministers’ Meeting.
- When
- The signing is expected in early October; Mexico’s reported tariffs are scheduled to begin on January 1, 2026.
- Why
- The proposal aims to improve market access and expand trade, particularly in automobiles, pharmaceuticals, engineering goods and chemicals.
Expansion prospects
Trade risks
Effect of the proposed pact
Expansion prospects
Improved market access could help automobiles, auto components, pharmaceuticals, engineering goods and chemicals expand in Mexico.
Trade risks
The agreement’s benefits could be limited if high Mexican tariffs continue to raise exporters’ costs.
Automotive and engineering trade
Expansion prospects
Automobiles and auto parts already lead India’s exports to Mexico and could have significant room for growth.
Trade risks
Mexico’s tariffs of up to 50% on more than 1,400 imports could particularly affect automobiles and engineering goods.
Key facts
- Proposed agreement
- Preferential trade agreement between India and Mexico
- Expected next step
- Signing of Terms of Reference in early October
- India’s exports to Mexico
- $5.73 billion in 2025-26
- India’s imports from Mexico
- $2.11 billion in 2025-26
- Total bilateral trade
- $7.83 billion in 2025-26
- Reported Mexican tariffs
- Up to 50% on more than 1,400 imports from January 1, 2026
- India–CELAC trade
- More than $50 billion annually, according to S Jaishankar
Quotes
S Jaishankar
India’s External Affairs Minister speaking at the India-CELAC Foreign Ministers’ Meeting
“Our GDP has more than doubled, growth has remained robust, and India today combines a large and increasingly skilled human resource base with increasing capabilities, growing market, strong digital infrastructure and expanding technology capacities.”
livemint.com
“We are glad to note that India–CELAC trade has now crossed over USD 50 billion annually, yet there is much more room to grow.”
livemint.com
Sources
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