India and Mexico Launch Preferential Trade Agreement Negotiations

India and Mexico formally launched negotiations for a Preferential Trade Agreement (PTA) on October 28, 2026. The process began with the signing of the Terms of Reference by Rajesh Agrawal, India's Commerce Secretary, and Luis Rosendo Gutierrez Romano, Mexico's Undersecretary of Foreign Trade, in Mexico City.

The negotiations follow an understanding reached between Prime Minister Narendra Modi and President Claudia Sheinbaum during the June 2025 G7 Summit in Canada. The agreement is primarily driven by Mexico's January 1, 2026, implementation of import tariffs ranging from 5% to 50% on over 1,400 products from countries without trade agreements. These duties heavily impact Indian exports of automobiles, auto components, textiles, steel, and engineering goods, with passenger vehicle duties reaching 50%.

India seeks the PTA to restore the competitiveness of its exporters and secure preferential market access. Merchandise exports from India to Mexico reached $5.73 billion in 2025-26, with the automotive sector alone accounting for nearly $1.5 billion. Overall bilateral trade stood at $7.83 billion in 2025-26, representing a 9.11 percent decrease from the previous year. The two nations aim to expand trade in chemicals, electronics, and pharmaceuticals, and are discussing a Mexican business mission to India for early 2027.