Canada Looks To Diversify Trade Ties With India Under Carney’s Leadership. Here’s What It Means

The victory of Mark Carney’s Liberal Party is anticipated to improve the strained bilateral ties between New Delhi and Ottawa. In fact, in his campaign, Carney had identified rebuilding ties with India as a priority.

"What Canada will be looking to do is to diversify our trading relationships with like-minded countries, and there are opportunities to rebuild the relationship with India. There needs to be a shared sense of values around that commercial relationship, and if I am Prime Minister, I look forward to the opportunity to build that," he had said in a report by NDTV.

India and Canada’s ties suffered in 2023 after the Trudeau government’s accusations that  "Indian agents" were involved in the killing of Hardeep Singh Nijjar, a Canadian citizen and a Khalistani terrorist, outside a gurdwara in Surrey, British Columbia, in June 2023. India has denied the allegations.

Tensions flared again in October of the same year after Canada expelled six Indian diplomats. Both nations expelled top envoys, froze trade negotiations, and suspended official visits. India has accused Canada of tolerating extremism among Canada's Sikh diaspora and accommodating separatist rhetoric.

Education & Economy

India remains one of the largest sources of immigration to Canada, with the Indo-Canadian community and overseas Indians numbering nearly 2.8 million across categories such as temporary workers, students, and permanent residents. Indian students alone, estimated at over 427,000, play a big role in Canada's education and labour market.

Carney, who was called a threat to Canadian autonomy by the US President Donald Trump, has talked about diversifying Canada's trade relationships. He has named India as a key partner.

One of the major casualties of the diplomatic standoff was the Comprehensive Economic Partnership Agreement (CEPA) between Canada and India. In 2023, bilateral services trade reached CAD 13.49 billion. Both countries had previously explored deeper collaboration in areas like artificial intelligence, fintech, green energy, and higher education.

With Carney at the helm, these sectors could see renewed momentum, particularly as Canada and India seek to diversify economic ties away from reliance on China and the United States.

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