India, Mexico launch negotiations for preferential trade agreement

Bilateral merchandise trade between the two countries stood at about $7.83 billion in FY26, with India recording a trade surplus of around $3.62 billion.

New Delhi: India and Mexico have formally launched negotiations for a preferential trade agreement (PTA), signing the terms of reference that define the scope and framework for talks aimed at expanding bilateral trade and investment, according to a press statement from the commerce ministry.

The move is part of India’s broader efforts to forge bilateral trade deals to bolster exports at a time when geopolitical conflicts have forced a realignment of global supply chains.

Bilateral merchandise trade between the two countries stood at about $7.83 billion in FY26, with India recording a trade surplus of around $3.62 billion. India's exports to Mexico were $5.73 billion, down 0.38% from the previous year, while imports fell 26.59% to $2.11 billion, according to official Indian trade data.

Automobiles were India's largest export category to Mexico, accounting for around $1.92 billion. Other important categories included auto components, pharmaceuticals, engineering goods and chemicals. Crude oil accounted for about three-fourths of Mexico's shipments to India.

The terms of reference cover market access for goods, rules of origin, customs procedures and trade facilitation, dispute settlement, sanitary and phytosanitary measures, technical barriers to trade, and trade remedies, the commerce ministry said.

The proposed agreement aims to create new business opportunities, enhance investment flows and strengthen supply chains by leveraging complementarities between the two economies.

The initiative follows an understanding between Prime Minister Narendra Modi and Mexican President Claudia Sheinbaum on the sidelines of the G7 Summit in Canada in June 2025 to deepen bilateral ties.

Expanding commercial ties

During a visit to Mexico by commerce secretary Rajesh Agrawal, Indian and Mexican officials met to discuss expanding trade and investment. Agrawal held talks with Mexico’s undersecretary of foreign trade Luis Rosendo Gutiérrez Romano, who represented economy secretary Marcelo Ebrard Casaubon.

Mexico is an important market for Indian exporters and investors because of its links to global value chains. Sectors identified for potential cooperation include automobiles, chemicals, electronics, pharmaceuticals, agri-food, energy, critical minerals, medical devices and advanced manufacturing.

The two sides also discussed the possibility of organising a Mexican business mission to India in the first quarter of 2027. The proposed visit would facilitate business-to-business meetings, help identify commercial opportunities, and strengthen ties between businesses in the two countries.

The negotiations mark a step towards a broader economic partnership, with both sides seeking to expand market opportunities and strengthen commercial engagement.

About the Author

Harsh Kumar is a policy reporter at Mint (HT Media Group), where he covers the Ministry of Commerce and Industry along with key departments of the Ministry of Finance, including the Department of Economic Affairs (DEA) and the Department of Financial Services (DFS). With over five years of experience in business and economic journalism, he has developed strong expertise in tracking policy developments and their wider economic impact.<br><br>He has previously worked with Business Standard, Moneycontrol, and Outlook Money, where he reported extensively on banking, financial services, and the broader economy. Over the years, he has built a reputation for delivering accurate, insightful, and impactful stories, supported by a keen eye for detail and a consistent track record of breaking exclusive news.<br><br>An alumnus of Jamia Millia Islamia, Harsh closely follows regulatory changes and key economic trends shaping India’s financial and industrial landscape. His reporting aims to simplify complex policy issues for a wider audience while maintaining depth and credibility.<br><br>Outside of work, he enjoys tracking policy developments, finding scoops, and travelling, reflecting his curiosity about how economic decisions shape everyday life.