• Source:JND
Add as a preferred

India-Canada Diplomatic Row: Trade negotiations between India and Canada have been impeded as tensions mount following Canadian Prime Minister Justin Trudeau's claims against the Prime Minister Narendra Modi-led government over the killing of Khalistani terrorist Hardeep Singh Nijjar. Relationships between the two nations, which were historically based on trade and the existence of a sizable Indian diaspora in the country, have increasingly deteriorated in recent years as India has repeatedly accused Canada of encouraging support for a Sikh separatist movement.

ALSO READ: How Canada Became Hotbed Of Khalistani Movement, Ignoring India's Appeal For Action Over Years

The relationship hit rock bottom on Monday when Trudeau made an explosive statement saying the Canadian security agencies have been "actively pursuing credible allegations of a potential link between agents of the Government of India and the killing of a Canadian citizen, Hardeep Singh Nijjar." Shortly after Trudeau's remarks, the Indian government dismissed Trudeau’s claims, calling them "absurd and motivated".

The already strained relationship between India and Canada became more evident during the G-20 summit in New Delhi earlier this month when the Canadian PM, unlike other Western leaders, did not hold formal bilateral talks with PM Modi. Instead, two leaders raised serious concerns with each other when PM Modi brought up "continuing anti-India activities of extremist elements in Canada".

India-Canada Ties: Here's What Is At Stake For Both Countries Due To Growing Tensions

How Trade Talks Affected Between India And Canada

Just three months after the two countries declared they hoped to reach an initial deal this year, Canada unpredictably announced that it has suspended negotiations on a potential trade treaty with India. Since 2010, there have been discussions between Canada and India on establishing a comprehensive economic alliance. Last year, the negotiations were formally restarted.

Industry estimates show the Comprehensive Economic Partnership Agreement (CEPA) between Canada and India could boost two-way trade by as much as USD 6.5 billion, yielding a GDP gain of USD 3.8 billion to USD 5.9 billion for Canada by 2035, according to news agency Reuters.

What Are Key Items India And Canada Trade

Canadian farmers have benefited from India's rising demand for imported lentils, while Indian pharmaceutical and software companies have expanded their presence in the Canadian market. The deepening rift between the two nations could possibly hamper Canadian farmers and Indian pharmaceutical and software companies. Major imports from Canada include energy products such as coal, coke and briquettes, besides fertilizers, while India exports consumer goods, garments, and engineering products such as auto parts, aircraft equipment, and electronic items.

India-Canada Ties: How Corporates Benefited

While over 30 Indian companies, including infotech giants TCS, Infosys, and Wipro, have invested billions of dollars in Canada and generated thousands of jobs, over 600 Canadian businesses, including Bombardier and SNC Lavalin, have a strong presence in India.

Role Of Indian Students In Canada

India has been the top source country for foreign students in Canada since 2018. According to the Canadian Bureau of International Education, their number increased by 47 per cent to close to 320,000 in 2022, making up roughly 40 per cent of all international students. This aids universities and colleges in providing domestic students with subsidised education.