Mexico City (Mexico): India and Mexico have formally launched negotiations for a Preferential Trade Agreement after signing the Terms of Reference in Mexico, in a move expected to broaden bilateral commerce, investment and supply-chain cooperation.

The agreement was signed by India’s Commerce Secretary, Rajesh Agrawal, and Mexico’s Undersecretary of Foreign Trade, Luis Rosendo Gutiérrez Romano. It marks the formal beginning of talks for a mutually beneficial and balanced trade pact between the two economies.

The framework identifies the principal areas for negotiation, including improved market access for goods, rules of origin, customs procedures and trade facilitation, dispute settlement, and measures to address technical trade barriers. Officials said the negotiations would aim to create new business opportunities, increase investment flows and help build resilient and diversified supply chains.

The initiative follows an understanding reached between Prime Minister Narendra Modi and Mexican President Claudia Sheinbaum during their meeting on the margins of the G7 Summit in Canada in June last year. The two leaders had then agreed to strengthen and deepen the India-Mexico partnership.

A Preferential Trade Agreement generally provides for reduced tariffs or other trade concessions on selected goods between participating countries, without requiring the comprehensive liberalisation associated with a full free trade agreement.

India and Mexico have steadily expanded economic engagement in recent years, with cooperation spanning trade, investment, pharmaceuticals, information technology, automobiles and agriculture. Further negotiations will now proceed under the agreed framework, with both sides expected to work towards a mutually acceptable agreement.