The end of the crisis between Canada and India is not easy to predict. Canada has a general election coming up in October next year, and if Justin Trudeau wins again, his stance on India is unlikely to change.
On Tuesday, Canada’s Foreign Minister Melanie Joly said that they have several options in view of the country’s current relationship with India. One of them is to impose sanctions on India.
Prominent Sikh leaders in Canada are also demanding restrictions or sanctions on India. Notable among the leaders on this list is Jagmeet Singh of the New Democratic Party, with whose support Justin Trudeau’s government ran for nearly four years.
In September, Jagmeet Singh withdrew his support from Justin Trudeau’s government. However, after increasing Canada’s tension with India, he is again seen with Justin Trudeau.
At a press conference on Monday this week, Canadian Prime Minister Trudeau blamed the Indian government for not cooperating with the investigation into the murder of Sikh leader Hardeep Singh Nijjar. He raised various allegations against India.
Meanwhile, India is also very angry about Canada’s position in the murder case of pro-Khalistan leader Hardeep Singh Nijjar. India expelled six diplomats from the Canadian mission in Delhi and decided to withdraw other diplomats including the high commissioner from Canada. On the other hand, Canada has counterclaimed that six Indian diplomats have been expelled on their behalf.
The extreme deterioration in the relationship between the two countries is quite clear. Now the question is if Canada really imposes sanctions against India in this climate, who will suffer more?
How deep is the relationship between the two countries?
According to many who keep track of the two countries, India-Canada relations are worse at the moment than India-Pakistan relations.
Michael Kugelman, director of the South Asia Institute of the American think tank ‘The Wilson Center’, also believes that Canada’s relationship with India is worse than India-Pakistan’s. But India’s strategic affairs expert Brahma Chelani doesn’t think so.
I don’t believe the relationship between India and Canada has gotten any worse than the India-Pakistan relationship,” Chelani was heard saying in an episode of the English news channel ‘India Today’ on Thursday.
He was saying that the connection between the common people of Canada and India is still very deep. Trade between India and Canada is increasing. Canada has a trade surplus. But there is nothing like that between India and Pakistan.
Tanvi Madan is a senior fellow at the think tank Brookings Institute. He also refuses to accept that India’s relationship with Canada is worse than the India-Pakistan equation.
Reposting the video clip of Brahma Chelani’s remarks on social media, Tanvi Madan wrote, thankfully someone logically dismissed the theory that India-Canada relations have deteriorated worse than India-Pakistan relations.
In that post he also wrote that 1 million Indians do not live in Pakistan. Pakistan’s pension funds are not investing in India and Pakistan-India trade has not grown by 62 per cent over the past decade.
Investments of Canadian pension funds in India
Millions of students from India go to Canada for education. According to the December 2023 document of the Indian Ministry of External Affairs, 230,000 Indian students are studying in that country. Besides, 18 lakh people of Indian origin are citizens of Canada and 10 lakh Indians live in that country.
In this context, Canada has become an important country for Indians. The recent rise in tension between the two countries will have a direct impact on Indians living there.
On the other hand, it is also noteworthy that Canada benefits financially as Indian students go to study in that country. Experts believe that if Canada imposes sanctions on India in view of the current situation, then the deep economic ties between the two countries may be hit.
The Canadian Pension Plan Investment Board and other institutional investors in that country have so far invested a total of $75 billion in India. India is an emerging economy and it is expected that the investment by the Canadian pension fund will not stop immediately.
On the other hand, Canada has a presence of more than 600 companies in India. More than 1000 Canadian companies are actively doing business with India. Indian companies in Canada are active in IT, software development, steel, natural resources and banking sectors.
In terms of business relationships, who is heavier?
India mainly exports gems, jewellery, precious stones, pharmaceuticals, ready-made garments, bio-chemicals and light engineering products to Canada. And pulses, newsprint, wood logs, asbestos, potash, scrap iron, copper, minerals and industrial chemicals are imported to India from Canada.
According to the National Investment Promotion and Facilitation Agency (Invest India), Canada is ranked 18th among foreign investors in India.
Canada’s total investment in India from 2020-2021 to 2022-2023 was $3.31 billion. Although this Canadian investment is only half percent of India’s total FDI.
An Indian government source, who did not want to be named, told Reuters news agency, “We are not concerned about trade relations with Canada at the moment.” Our bilateral trade with Canada is not very large. Canadian pension fund money invested in India is based on returns. India is getting good returns, so we are not worried about that either.
According to India’s Ministry of Commerce, bilateral trade between Canada and India was $8.4 billion as of March 31 last fiscal year. Which is slightly more than the previous financial year.
Canadian Trade Minister Mary Ng said on Monday, “I want to assure business groups that our government is fully committed to trade relations with India.”
What is the real problem with Prime Minister Trudeau?
In August, Canada exported $27.9 billion to India and imported $32.4 billion from India. This number is 14 percent higher than last year’s August.
Ajay Bisaria was the High Commissioner of India to Canada from 2020 to 2022. He told the English newspaper Hindustan Times, “I don’t think there will be any impact on trade and investment.” India’s problem is Trudeau, not Canada. Both countries have made it clear that there should be no barriers to trade, visas and people-to-people contact.
Negotiations on a free trade agreement between the two countries also began in March 2022. Till last year, there were nine rounds of talks between the two countries, but now all the talks have stopped.
But it’s not just about business. Democracy requires more votes to win elections and vote bank politics also takes into account the sentiments of different communities.
According to 2021 statistics, 2.1% of Canada’s population belongs to the Sikh community. From 2001 to 2021, the Sikh population in Canada has grown significantly over the past 20 years. Most of them migrated from Punjab to Canada for reasons like education, career, job. More than half of the Sikh population living in Canada live in Toronto and Vancouver. All these areas are very important keeping in mind the Sikh vote bank.
India claims that Prime Minister Trudeau is speaking on behalf of Khalistan supporters in Canada because of his political agenda.
Incidentally, the Trudeau government was running with the support of Jagmeet Singh’s New Democratic Party. That support was withdrawn in September. However, Prime Minister Trudeau managed to win a confidence motion in Parliament despite withdrawing support.
Elections are scheduled to be held in Canada in October 2025 and Justin Trudeau wants the Sikh community living in Canada to support him.
Source: BBC Bangla
