By Suneel Ratan

(FORTUNE Magazine) – The Bush Administration is pressing ahead with a politically risky strategy to reach a free-trade deal with Mexico at a time when lost U.S. jobs are uppermost in the voters' minds. The White House plans to initial an agreement in July and send it to Congress for approval.

But the measure is likely to languish there until after the election, making the agreement a whipping boy of the fall campaign -- especially with Ross Perot leading the opposition to the pact. Says an aide to House Ways and Means Committee Chairman Dan Rostenkowski, a trade-accord backer: ''It's going to be a tough year for any presidential candidate to push a foreign policy initiative that in any way appears to be a reward for foreigners and a sacrifice for some Americans.'' Bill Clinton, the likely Democratic candidate, is also a supporter of the trade agreement and is therefore similarly snared. The White House is leaving itself room to wiggle. Says Kathy Lydon, spokesperson for U.S. Trade Representative Carla Hills: ''It has to be a good agreement, or we won't shake hands.'' Sticking points include allowable levels of U.S. investment in Mexican oil and gas and the timing of reductions in tariffs on agricultural products. With voters in mind, the eventual package sent to Capitol Hill will include provisions to help workers who might lose their jobs as a result of the agreement.