Prime Minister Narendra Modi with his Canadian counterpart Justin Trudeau. But ties are now touched a new low (File Photo)
The indefinite suspension of India-Canada negotiations for a free trade agreement has started to cause worries for Ottawa. Amid an acute economic slowdown in Canada, Ottawa would need India’s growing market to support its growth. Canada’s economy contracted by 0.2 per cent on an annualised basis in the second quarter of the year – much below market expectations of a 1.2 per cent growth.
India’s top imports from Canada include mineral oils and pulses among other things. So far, there has been no dent in bilateral trade despite stalled talks on a Comprehensive Economic Partnership Agreement.
“For India, the (trade) agreement with Canada is of no major significance. There are other trade agreements which are being looked into. The blow will be felt more by Canada as it currently battles an economic slowdown,” an official source told India Narrative.
Many economists opine that the Canada’s economic uncertainty is here to stay. The slowdown in economy has also impacted jobs while inflation is also rising.
“If the current crisis in bilateral relations between Canada and India is allowed to escalate there’s bound to be only one loser. It won’t be India,” Canadian newspaper the Globe and Mail said in a report.
“We need to reset a relationship that has clearly gone off-course,” the newspaper said.
According to the news organisation, industries and sectors in the country have been closely watching the dispute between New Delhi and Ottawa “and asking what it means for the two countries’ economic relationship.” Earlier Canada described India as its priority market.
A host of Canadian conglomerates have been eyeing the Indian market amid the economic growth.
Besides, a presence of a large number of Indian students in Canada has also supported the country’s economy.
With the geopolitical wind changing and China grappling with its own domestic problems, India’s rise has been noticed the world over.
While most other prominent economies of the world are now trying to woo New Delhi– the US for example has already signed several agreements on technology, connectivity, renewable energy among others, the new low in India Canada relations could deal a blow to Ottawa.
India Canade ties nosedived after Canadian Prime Minister Justin Trudeau alleged that New Delhi was behind the killing of Hardeep Singh Nijjar, a Canadian citizen and chief of the banned Khalistan Tiger Force (KTF).
Canada is home to about 800,000 Sikhs—the largest Sikh population outside India. The Sikhs in Canada comprises roughly 2 per cent of the population.