Although on different political paths, India and Mexico find common ground in strong trade relations and seek similar developmental outcomes.
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The recently held elections in Mexico and India saw the incumbent parties begin their campaigns from a similar course. The leaders in both countries, India’s Prime Minister Narendra Modi from the Bharatiya Janata Party (BJP) and Mexico’s Andrés Manuel López Obrador (known by his initials, AMLO) from the Morena party, are immensely popular. According to Morning Consult, a pollster, they hold the highest approval ratings of any heads of government in the world—Modi at 70 percent and AMLO at 62 percent. As expected, their popularity translated to a favourable electoral outcome. In both countries, the incumbent governments were voted back into power despite a united opposition that hobbled together a big-tent coalition to put up a tougher fight. In India, Modi has begun his third term as prime minister. Since Mexico’s Constitution restricts presidents to a single six-year term, AMLO was ineligible to run for re-election, but his party’s candidate Claudia Sheinbaum coasted to an easy victory. This is where the similarities end. The governments in both countries now follow vastly different paths.
The recently held elections in Mexico and India saw the incumbent parties begin their campaigns from a similar course. The leaders in both countries, India’s Prime Minister Narendra Modi from the Bharatiya Janata Party (BJP) and Mexico’s Andrés Manuel López Obrador (known by his initials, AMLO) from the Morena party, are immensely popular.
Despite Sheinbaum’s massive margin of victory, she faces numerous challenges. The first is to step out of AMLO’s shadow. Although critics paint her as a proxy for AMLO, Sheinbaum proved her own worth in her handling of the COVID-19 pandemic as the Head of Government of Mexico City—she took a more scientific approach to the health crisis, a far cry from the federal government’s rather lenient methods. In her first act as president-elect, she has named a cabinet full of technocrats, who possess respectable professional credentials. A local report estimates that Sheinbaum and her newly-named cabinet enjoy an 80 percent approval rating amongst Mexicans. Even Mexico’s business groups, which were often at loggerheads with AMLO’s government, look at Sheinbaum with more optimism, as evidenced in her initial meetings with business leaders like Francisco Cervantes, President of the influential Consejo Coordinador Empresarial (Business Coordinating Council) and Kathryn McLay, President and CEO of Walmart International.
Other major challenges include security and drug trafficking, illegal immigration, and a high budget deficit. According to a recent poll, 51 percent of Mexicans believe security should be Sheinbaum’s top priority. Unfortunately, there are no easy solutions to the security issue. For better or worse, geography has determined much of Mexico’s fate, given its proximity to the United States and its neighbours in the Latin American region. As long as the US continues consuming copious quantities of illegal drugs, Mexico will continue to be a go-between for cocaine producers in South America. No Mexican president to date has found long-lasting solutions to stem the high levels of violence that accompany the drug trade.
Setting aside these challenges, Mexico has its bright spots. As per the country’s measure of multidimensional poverty (which includes income, as well as access to education, food, and healthcare), the poverty rate has decreased from 46 percent in 2014 to 36 percent in 2024. Much of this decrease is owed to the steady and continuous rise in the minimum wage, which has increased 19 percent over the six-year term of the current government. Mexico’s stock exchange has risen from 41,640 points at the beginning of AMLO’s presidency in December 2018 to 52,883 points in July 2024. As a result, the Mexican economy is today larger than major economies like South Korea, Australia, Indonesia, or Spain. The Mexican economy has also been stimulated by the recent trend of reordering value chains away from China, a strategy that the US has christened as ‘friendshoring’. Here, Mexico’s interests align directly with India’s—both are partners in economic diplomacy.
Setting aside these challenges, Mexico has its bright spots. As per the country’s measure of multidimensional poverty (which includes income, as well as access to education, food, and healthcare), the poverty rate has decreased from 46 percent in 2014 to 36 percent in 2024.
Mexico has long been a major investment destination for Indian companies, primarily from the autoparts, technology and pharmaceutical sectors. Today, Indian companies have invested an estimated US$4 billion in Mexico, and employ about 60,000 people in the country. Even Mexican companies have their eyes set on India, and numerous Mexican companies including breadmaker Bimbo, cinema operator Cinépolis, and edutainment company KidZania are leaders in the Indian market. About three dozen Mexican companies have invested in the Indian market, including in the automobile sector, with a total investment of more than US$1 billion over the past two decades.
Mexico has long been a major investment destination for Indian companies, primarily from the autoparts, technology and pharmaceutical sectors. Today, Indian companies have invested an estimated US$4 billion in Mexico, and employ about 60,000 people in the country.
Whatever path Sheinbaum and Modi take, they are certain to find common ground when it comes to trade and investment between India and Mexico, which remains complimentary and is a win-win for both sides. In fact, India-Mexico trade peaked at US$9 billion in 2022-23, more than India’s trade with neighbouring Nepal, Canada, or Spain. Both countries are leaders in their respective regions—India in South Asia and the larger Indo-Pacific region, and Mexico in Latin America, as an economic powerhouse that has benefitted greatly from its proximity to the United States (US). The newly-elected governments in both countries stand to benefit from closer cooperation with each other, in bilateral forums like the G20 as well as representatives of the developing world that may seem to follow divergent political paths, but seek similar developmental outcomes.
Hari Seshasayee is a Visiting Fellow at Observer Research Foundation.
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Hari Seshasayee is a visiting fellow at ORF, part of the Strategic Studies Programme, and is a co-founder of Consilium Group. He previously served as ...
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