ISSN 2330-717X

Mexico, The Other North American Partner – Analysis

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This year marks the completion of 70 years of diplomatic relations between India and Mexico – but the full potential of this bilateral relationship has not been explored. Mexico exports oil to India, and hosts facilities of the Indian auto, IT and pharma sectors. There are three profitable reasons to intensify the bilateral, fulfilling both the diplomatic and business agenda.

By Rajiv Bhatia*

The India-Mexico story is about two countries not having done enough to tap the full potential of their relationship.

Located on opposite sides of the globe, they have cooperated on many fronts. Yet, in the context of the changing international landscape, they are now gearing up for the expansion of Mexico’s footprint in Asia and India’s in Latin America. They need a renewed process of purposeful engagement and a band of activists, both in and outside the government, to take the relationship to a higher level.

In June 2016, Prime Minister Narendra Modi paid a short, productive visit to Mexico. Overruling his advisers, President Enrique Pena Nieto assured his guest of Mexico’s support for India’s bid to join the Nuclear Suppliers Group (NSG). While the NSG membership still eludes India, its relations with Mexico received a notable boost. The two leaders directed their foreign ministers to develop “the roadmap of the Privileged Partnership for the 21st Century”.[1]

The momentum generated by that visit petered out, but in recent months, another endeavour has been underway to give new traction to the relationship: it began in July 2019, when the two foreign ministers had a cordial meeting on the sidelines of the G20 summit in Osaka. In September, Foreign Minister Marcelo Ebrard was scheduled to visit Delhi, but Vice Minister for Foreign Affairs, Julian Ventura, came visiting instead. It was an action-packed trip. Foreign Office Consultations (FOC) were held, anchored in a broad agenda.[2] Ventura had a substantive meeting with External Affairs Minister S. Jaishankar. Further, the establishment of a ‘Mexico-India University Presidents’ Forum’ was announced. Finally, Ambassador Federico Salas revealed that the two governments were working to elevate the existing ties from ‘privileged’ to ‘strategic’ partnership. In January 2020, Ventura was again in India to participate in the Raisina Dialogue.

Positive signs

Such diplomatic reciprocity gives room for optimism. But there is no denying the differences[3] between the two countries on UN reform, nuclear disarmament and non-proliferation issues and the domestic preoccupations of President Andrés Manuel López Obrador (AMLO). At the same time, the commonalities the two countries share – such as development experience, economic complementarity, cultural affinity and a history of rich exchanges between governments and peoples – can usher in a warmer, closer phase.

First, economic factors impart considerable energy. With two-way trade, having crossed $10 billion in 2018, India now figures at No. 9 among Mexico’s global trade partners. Mexico is India’s biggest trade partner in Latin America and the Caribbean region, and is the second biggest in all the Americas – after the U.S., India is also the third biggest buyer of Mexico’s crude oil.

A favourite base for Indian companies, Mexico hosts operations by such well-known players as the Mahindra Group, Tata Consultancy Services (TCS), Infosys, Wipro, Sun Pharma, and Dr. Reddy’s Laboratories.

Cinepolis, which is set to increase its nationwide screens from 300 to 500, and Grupo Bimbo, a global food company with production facilities in India, are among the more successful Mexican corporates in the Indian market. Investment in both directions has been on the rise, with Indian investment in Mexico valued at $3 billion and Mexican investment in India touching $1 billion.

Second, both AMLO and Modi are popular leaders. The first won the elections and took over as president in December 2018. Modi is in his second term, back in office with a stronger mandate. While the Mexican president has shown much less interest in foreign affairs, this could change because of India’s rising diplomatic profile in world affairs.

Third, the two sides are finalising a substantive plan to celebrate the 70th anniversary of the establishment of diplomatic relations.[4] Mexico was the first Latin American country to recognise India after Independence and establish diplomatic relations in 1950. The Indian external affairs minister may soon visit Mexico City, which may be followed by the Mexican president coming to India.

Both countries are candidates for the non-permanent seats of the Security Council for 2021-2022, with chances of success in the elections in June 2020. This, thus, is an apt time for arranging high-level interaction and better policy coordination between the two governments.

Where lies the potential?

Interest in India’s foreign policy, economy, democracy, culture and ‘India studies’ in Mexico far exceeds India’s interest in Mexico, an imbalance that needs to be rectified. India’s worldview has been expanding steadily, encompassing the Vanilla Islands in the western Indian Ocean, through the Pacific Island States, to the Caribbean region and Latin America: India’s strategic and academic community’s research on the region should reflect this.

India’s Indo-Pacific vision should include Mexico, a Pacific Ocean nation, especially in the economic aspects of the partnership. It is a signatory to the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP); a member of Asia Pacific Economic Cooperation (APEC); and has a thriving relationship with China, Japan and the Association of South East Asian Nations (ASEAN).

Mexican political planners too, instead of looking at India through the Atlantic prism of U.S. and Europe, have to ‘look East’ across the Pacific and assess the long-term impact of India’s rise, not only as an Asian power, but a substantive power centre in the emerging multipolar world. As members of the G20, they converge on climate change, international trade, and a rules-based global governance.

They also have a mutual interest in Africa and the Blue Economy. Vice Minister Ventura recently paid visits to South Africa, Ghana and Ethiopia. Leveraging its expertise and extensive experience, India could encourage collaboration between Mexican and Indian companies to explore business opportunities in select African countries in infrastructure, food processing, and digital innovation.

India has been deepening its knowledge of the Blue Economy’s potential, but Mexico has perfected profitability, especially from key sectors, such as marine/ cruise tourism. This is an area where India can learn from Mexico’s strongly professional and client-friendly approach. Tourist flows from India to Mexico are on the rise,[5] but more tourists in both directions — the people-to-people connect – will be an additional asset. Octavio Paz, noted author and Mexican ambassador to India, wrote in In Light of India: “I can understand what it means to be Indian, because I am Mexican.”

In less lyrical and more hard economic terms, Vice Minister Ventura listed the other sectors that hold promise, besides the people angle: aerospace, electric mobility, IT, digital finances or fintech and business incubation. Oil will remain important in the short to medium term.

Geopolitics matters too. The U.S., being a top partner for both India and Mexico, should form the subject of fascinating conversation between Delhi and Mexico City. A new 1.5 Track Dialogue, involving officials, scholars and experts, which imparts fresh ideas and a new momentum, will be beneficial – just as the recently concluded India-Canada one was.[6]

*About the author: Rajiv Bhatia is Distinguished Fellow, Gateway House. He is a former ambassador to Mexico.

Source: This article was written for Gateway House: Indian Council on Global Relations.

References 

[1] Ministry of External Affairs, ‘India-Mexico Joint Statement during the visit of Prime Minister to Mexico’, Government of India, 8 June 2016, https://www.mea.gov.in/bilateral-documents.htm?dtl/26889/IndiaMexico_Joint_Statement_during_the_visit_of_Prime_Minister_to_Mexico

[2] Ministry of External Affairs, ‘Foreign Office Consultations between India and Mexico’, Government of India, 7 October 2019,

and

Secretary of Foreign Relations, ‘Undersecretary Julian Ventura begins visit to India’, Government of Mexico, 7 October 2019, https://www.gob.mx/sre/prensa/undersecretary-julian-ventura-begins-visit-to-india?idiom=en

[3] On the question of UN reform, India and like-minded members of the G4 (Germany, Japan and Brazil) have been pushing for the expansion of the Security Council, and their inclusion whereas Mexico is a member of the ‘Coffee Club’ which is opposed to the proposal. On nuclear issues, Mexico is a signatory to the Non Proliferation Treaty (NPT) and Comprehensive Nuclear-Test-Ban Treaty (CTBT), while India is not.

[3] Sibal, Sidhant, ‘Can share our good, bad experiences with India on trade deal with US: Mexico’, WION, 15 October 2019, https://www.wionews.com/india-news/can-share-our-good-bad-experiences-with-india-on-trade-deal-with-us-mexico-256041

[4] Sibal, Sidhant, ‘Can share our good, bad experiences with India on trade deal with US: Mexico’, WION, 15 October 2019, https://www.wionews.com/india-news/can-share-our-good-bad-experiences-with-india-on-trade-deal-with-us-mexico-256041

[5] Mexicans have been extended the online e-Tourist Visa facility and around 15,000 Mexicans visited India in 2016. Over 50,000 Indian tourists visit Mexico annually, mostly from the U.S. and Europe.

Ministry of External Affairs, ‘India-Mexico Relations’, Government of India, October 2017, https://mea.gov.in/Portal/ForeignRelation/Mexico-India_Relations_October_2017.pdf

[6] Bhatia, Rajiv, ‘India-Canada: blueprint for cooperation’, Gateway House, 5 December 2019, https://www.gatewayhouse.in/india-canada-cooperation/


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Gateway House

Gateway House

Gateway House: Indian Council on Global Relations is a foreign policy think-tank established in 2009, to engage India’s leading corporations and individuals in debate and scholarship on India’s foreign policy and its role in global affairs. Gateway House’s studies programme will be at the heart of the institute’s scholarship, with original research by global and local scholars in Geo-economics, Geopolitics, Foreign Policy analysis, Bilateral relations, Democracy and nation-building, National security, ethnic conflict and terrorism, Science, technology and innovation, and Energy and Environment.

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