Why Modi government wants a limited trade deal with Mexico
What's the story
In light of Mexico's recent decision to impose steep import tariffs, India has proposed a limited trade deal with the Latin American nation. The move comes after the Mexican Senate approved a plan on December 11 to raise import duties by up to 50% next year on over 1,400 goods from India, China, and other Asian countries.
Trade impact
Indian exports to Mexico likely to be impacted
The proposed tariff hike could have a major impact on Indian exports worth around $2 billion to Mexico. The sectors that could be hit include automobiles, two-wheelers, auto parts, and textiles. In light of this potential trade disruption, India has suggested a Preferential Trade Agreement (PTA) as a quicker alternative to a full-fledged Free Trade Agreement (FTA).
Ongoing negotiations
India-Mexico trade discussions underway
Commerce Secretary Rajesh Agarwal confirmed that discussions with Mexico are already underway. He said, "The quicker way is to get a Preferential Trade Agreement because a free trade agreement will take longer."