India and Mexico Begin Preferential Trade Agreement Talks to Boost Trade, Investment and Market Access

India and Mexico have launched Preferential Trade Agreement negotiations to improve market access, attract investment, diversify supply chains and strengthen bilateral economic cooperation across key sectors.

India and Mexico Launch Preferential Trade Agreement Talks to Boost Bilateral Trade

India and Mexico have formally begun negotiations for a Preferential Trade Agreement (PTA), aiming to expand trade, encourage investment and strengthen economic ties between the two countries.

The negotiations commenced following the signing of the Terms of Reference (ToR), which establishes the framework, scope and procedures for discussions. The initiative is expected to improve market access for businesses, support diversified supply chains and create opportunities across several priority industries.

India’s Commerce Secretary Rajesh Agrawal and Mexico’s Undersecretary of Foreign Trade Luis Rosendo Gutiérrez Romano signed the document during Agrawal’s official visit to Mexico.

Terms of Reference Define the Scope of PTA Negotiations

The signed Terms of Reference provides a structured roadmap for negotiations between India and Mexico. It outlines the key areas that both countries intend to discuss while working towards a mutually beneficial trade agreement.

The proposed PTA will cover several important aspects of international trade, including:

• Market access for goods

• Rules of origin

• Customs procedures and trade facilitation

• Dispute settlement mechanisms

• Sanitary and phytosanitary measures

• Technical barriers to trade

• Trade remedies

These provisions are intended to address trade-related challenges and establish clearer procedures for businesses operating across both markets.

India’s Department of Commerce said the two countries were working towards a balanced agreement that could increase bilateral trade, promote investment and create more diversified supply chains.

India-Mexico Economic Cooperation Gains Momentum

The latest negotiations follow discussions between Indian Prime Minister Narendra Modi and Mexican President Claudia Sheinbaum on the sidelines of the G7 Summit in Canada in June 2025.

During their meeting, the leaders agreed to deepen economic cooperation and strengthen commercial engagement between the two countries.

In the latest discussions, Mexico’s Undersecretary of Foreign Trade Luis Rosendo Gutiérrez Romano represented Secretary of Economy Marcelo Ebrard Casaubon.

Both delegations explored opportunities to expand business relationships and identify areas where stronger economic cooperation could benefit companies in India and Mexico.

The proposed agreement is part of these broader efforts to develop closer trade and investment links.

India-Mexico Bilateral Trade Reaches $8.74 Billion

According to data from the Directorate General of Commercial Intelligence and Statistics (DGCI&S), bilateral merchandise trade between India and Mexico reached $8.74 billion in 2024.

India recorded exports worth $5.73 billion, while imports from Mexico totalled $3.01 billion. This resulted in a trade surplus of $2.72 billion for India.

The figures highlight the existing commercial relationship and the potential for further expansion through improved market access and closer business cooperation.

Major Indian Exports to Mexico

India supplies a range of manufactured goods and industrial products to the Mexican market. Major export categories in 2024 included:

• Light vehicles: $880 million

• Motorcycles: $390 million

• Base metals: $760 million

• Automobile components: $740 million

These export categories demonstrate the importance of automotive manufacturing and industrial goods in bilateral trade.

A preferential trade arrangement could create opportunities for businesses in these sectors, depending on the final terms agreed upon by both governments.

Key Sectors Identified for Trade and Investment

India and Mexico have identified several sectors with potential for stronger commercial cooperation. These include automobiles, chemicals, electronics, pharmaceuticals, agricultural products, energy, critical minerals, medical devices and advanced manufacturing.

These industries are important to both countries because they support industrial production, technology development and international supply chains.

Improved trade conditions could help businesses explore new markets, establish commercial partnerships and diversify sourcing and production networks. However, the specific benefits will depend on the agreement’s negotiated provisions and implementation.

The inclusion of critical minerals, electronics and advanced manufacturing also points to opportunities for cooperation in strategically important industries.

Mexican Business Delegation to Visit India in 2027

As part of efforts to strengthen business engagement, the two countries discussed organising a Mexican business delegation’s visit to India during the first quarter of 2027.

The proposed visit would provide a platform for business meetings, commercial discussions and the identification of investment opportunities.

Direct engagement between companies could help businesses better understand market conditions, establish partnerships and explore potential projects in priority sectors.

The visit would complement the formal PTA negotiations by encouraging practical business-to-business cooperation alongside government-level discussions.

What the Proposed India-Mexico PTA Could Mean

The launch of PTA negotiations marks an important step towards strengthening India-Mexico economic relations. By addressing tariffs and other trade-related issues within the agreed negotiating framework, the two countries aim to create better conditions for cross-border commerce.

The agreement could offer new opportunities for exporters, manufacturers and investors, particularly in automobiles, pharmaceuticals, electronics and advanced manufacturing.

However, the final impact will depend on the outcome of negotiations, the terms of the agreement and its eventual implementation.

Conclusion

India and Mexico’s decision to begin Preferential Trade Agreement negotiations reflects their shared interest in expanding trade, attracting investment and diversifying supply chains. With bilateral merchandise trade reaching $8.74 billion in 2024, the proposed pact could provide a foundation for stronger commercial ties. The upcoming negotiations and planned business engagement in 2027 will be important steps towards identifying new opportunities for both economies.