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​A reboot: On Canada-India ties

March 03, 2026 4 min read International Relations GS Paper 2 (India's Foreign Policy Bilateral Relations)
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What Happened

  • Canadian Prime Minister Mark Carney's four-day visit to India (February 27 – March 2, 2026) marked a significant diplomatic reset after years of strain under former PM Justin Trudeau.
  • The two leaders agreed to expand bilateral trade to CAD 70 billion (~USD 51 billion) by 2030, up from the current ~USD 9 billion annually.
  • Canada's Cameco Corporation and India's Department of Atomic Energy signed a CAD 2.6 billion long-term uranium supply agreement covering 22 million pounds of uranium ore concentrate over nine years (2027–2035).
  • India and Canada agreed to formally revive negotiations for a Comprehensive Economic Partnership Agreement (CEPA), aiming to conclude by end of 2026.
  • Carney described talks with PM Modi as "frank," signalling a thaw that does not erase the underlying tensions around the 2023 Nijjar case but acknowledges a commitment to cooperative accountability.

Static Topic Bridges

India-Canada Relations and the Nijjar Diplomatic Row

India-Canada relations fell sharply in 2023 after PM Trudeau alleged that Indian government agents were linked to the killing of Khalistani separatist Hardeep Singh Nijjar in Surrey, British Columbia. India denied the allegations and demanded evidence. In October 2024, both sides expelled six diplomats each, including high commissioners, marking the lowest point in bilateral ties since diplomatic relations were established in 1947. The Khalistan issue remains central to the friction — Canada is home to nearly 800,000 Sikhs, and India is wary of Khalistani separatist activity on Canadian soil.

  • Hardeep Singh Nijjar was designated a terrorist by India in 2020 and was killed in June 2023 near a Surrey Sikh temple.
  • Canada's RCMP alleged Indian government agents engaged in clandestine surveillance, coercive behaviour, and involvement in "over a dozen threatening and violent acts" targeting South Asian Canadians.
  • India maintains Canada has never provided substantive evidence despite multiple requests.
  • The diplomatic low point: India recalled its High Commissioner; both sides expelled six diplomats including top envoys in October 2024.

Connection to this news: Carney's visit represents the first high-level bilateral engagement since the expulsions. The joint statement indicates both sides have agreed to cooperate on accountability in the Nijjar case while moving toward economic normalisation — a pragmatic reset driven in part by the volatility created by US trade disruption under Trump.

India's Civil Nuclear Programme and Uranium Import Dependence

India operates one of the largest civilian nuclear power programmes among non-NPT states, with 22 operational reactors providing about 3% of total electricity generation and a target to raise nuclear capacity to 22,480 MW by 2031-32. India is not a signatory to the Nuclear Non-Proliferation Treaty (NPT), which historically limited access to international nuclear fuel markets. The 2008 India-US Civil Nuclear Agreement (123 Agreement) and the subsequent NSG waiver opened the path for civilian nuclear cooperation agreements with multiple countries including Russia, France, Australia, and now Canada.

  • India's uranium requirements are met through domestic sources (Jharkhand, Andhra Pradesh) and imports from countries like Kazakhstan, Russia, Uzbekistan, and now Canada.
  • The Cameco deal (22 million pounds of U3O8 over 9 years) provides supply-side diversification critical for India's nuclear expansion ambitions.
  • Canada was historically India's nuclear technology partner — the CANDU reactor technology used in India's Rajasthan Atomic Power Station came from Canada, before ties were severed after India's 1974 Pokhran test.
  • Reviving nuclear cooperation with Canada marks a full-circle diplomatic restoration of this decades-old partnership.

Connection to this news: The uranium supply deal is the most tangible deliverable of the Carney visit, and its scale — CAD 2.6 billion — signals that economic interests have overtaken diplomatic grievances in driving the bilateral agenda.

India's Trade Policy Architecture: FTAs and CEPA Negotiations

India has been selectively pursuing free trade agreements (FTAs) and Comprehensive Economic Partnership Agreements (CEPAs) as part of its commercial diplomacy strategy. India has operational CEPAs with UAE (signed 2022), Australia (interim ECTA 2022), and earlier agreements with Japan, South Korea, and Singapore. Negotiations with the EU, UK, and Canada had stalled or been deprioritised. CEPA negotiations with Canada were previously known as FIPA (Foreign Investment Promotion and Protection Agreement) talks and had been suspended amid the diplomatic tensions since 2023.

  • Current India-Canada bilateral goods trade is approximately USD 9 billion annually — well below potential given Canada's resource wealth and India's manufacturing growth.
  • A formal CEPA with Canada could liberalise trade in services (particularly IT, financial services), goods (pulses, lentils, natural resources), and investment flows.
  • The 2026 target is to finalise a comprehensive trade pact within the year, coinciding with both nations' interests in reducing US trade dependence after Trump's tariff disruptions.
  • Canada supplies roughly 25% of India's lentil and pulse imports — an existing complementarity that would grow under a CEPA.

Connection to this news: The Modi-Carney meeting's economic centrepiece — trade target of CAD 70 billion by 2030 and CEPA finalisation by 2026 — illustrates how geopolitical volatility (US tariffs, Trump-era unpredictability) is pushing former adversaries into pragmatic partnership.

Key Facts & Data

  • Current India-Canada bilateral trade: ~USD 9 billion annually
  • 2030 trade target set by Carney-Modi: CAD 70 billion (~USD 51 billion)
  • Cameco uranium deal: CAD 2.6 billion, 22 million pounds U3O8, 2027–2035
  • Indian diaspora in Canada: ~1.8 million (second largest immigrant group)
  • Canadian Sikh population: ~800,000 (2021 Census)
  • Nijjar killing: June 2023 in Surrey, British Columbia
  • Diplomat expulsions: October 2024, six from each side including high commissioners
  • India-US Civil Nuclear Agreement (123 Agreement): signed 2008, enabled international nuclear cooperation
  • India's nuclear capacity target: 22,480 MW by 2031-32 (currently ~7,480 MW from 22 reactors)