India - Canada Relationship

Posted 14 Nov 2024

Updated 16 Nov 2024

4 min read

Why in the News?

Recently, the diplomatic tensions escalated between India and Canada.

India ordered the expulsion of six Canadian diplomats and announced the withdrawal of its High Commissioner to Canada amidst diplomatic dispute.
Earlier, Canada had asked India to waive off diplomatic immunity of Indian officials alleging their involvement in an investigative matter, which India considered preposterous.
- Diplomatic immunity is a principle of international law, primarily derived from Vienna Convention, 1961 as per which foreign government officials are not subject to jurisdiction of local courts and other authorities for both their official and personal activities.

Issue of Khalistani Extremists: Sikh separatist groups supported by Canada have been a strain on relations causing diplomatic fallout.
Indian sovereignty: Despite repeated cautions from India, Canada’s support of Khalistani activities like unofficial referendum on forming an independent Sikh state in 2023 is an attack on India’s sovereignty.
Security cooperation: Multiple extradition requests from Government of India in respect of terrorists and organized crime leaders living in Canada have been disregarded.
Defunct Agreements: Comprehensive Economic Partnership Agreement and Foreign Investment Promotion and Protection Agreement have seen no progress.
Vote bank politics: Sikh community (especially in provinces like Ontario and British Columbia), form key vote bank for political parties.

It is a United Nation’s treaty defining rules and regulations for diplomatic relations between countries.
It sets common principles and terms on how countries must treat each other’s diplomatic representatives and extends privileges and immunities for them.
India acceded to it in 1965 and ratified in 1972 through Diplomatic Relations (Vienna Convention) Act of 1972.

Strategic and security cooperation: Both countries support a rules-based order in the Indo-Pacific, which is essential for regional security, peace and trade.
- Canada’s Indo-Pacific strategy, acknowledges China as an ‘increasingly disruptive global power’ and India as a ‘critical partner’ for collaborations in the shared interests of the region.
Economic and trade: In 2023, bilateral trade in goods between the two countries touched $9.36 billion, with India exporting $3.80 billion and importing $5.56 billion.
- The bilateral trade in services in 2023 was $ 9.99 billion.
Investment opportunities: Canadian Pension Funds have cumulatively invested over $ 75 billion in India and are increasingly viewing India as a favourable destination for investments.
Diaspora: Canada hosts one of the largest Indian Diaspora abroad (~1.8 million), which account for more than 3% of its total population.
Civil nuclear cooperation: Nuclear Cooperation Agreement (NCA) with Canada was signed in 2010, under which a Joint Committee on Civil Nuclear Cooperation was constituted.
Defence cooperation: Memorandum of Understanding (MoU) between DRDO and Canadian Commercial Corporation (CCC) for development of military and defence related technology, infrastructure etc., was renewed in 2021 (signed in 2016).

It’s a multilateral intelligence-sharing network shared by over 20 different agencies of five English-speaking countries (United Kingdom, USA, Canada, Australia and New Zealand).

It indulges in non-political intelligence oversight, review and security entities of the Five Eyes countries.

It is both surveillance-based and signals intelligence (SIGINT).
It had established Five Eyes Intelligence Oversight and Review Council to increase cooperation.

Strategic cooperation: Western countries’ response including Five Eye Alliance has been relatively restrained, which might strain cooperation in security, defence, nuclear energy etc.
Economic and trade agreements: May hurt bilateral trade and investment flow and further delays in trade negotiations.
- E.g., India-Canada Comprehensive Economic Partnership Agreement (CEPA), Foreign Investment Promotion and Protection Agreement (FIPA), and Early Progress Trade Agreement (EPTA).
Diaspora and student concern: Growing tensions may affect Indian diaspora in Canada especially Indian students.
- Estimated 230,000 Indian students study in Canada (Dec. 2023), comprises a significant section of the international student population of the country.
Immigration and Visa Processing: Potential suspension in visa services, citing security threats, could disrupt travel and immigration plans for individuals between the two countries.

Constructive diplomacy: Initiate high-level discussions to address mutual concerns transparently.
- Both sides should express their concerns without disrupting the status quo.
Security cooperation: Cooperate and collaborate on counter terrorism, Khalistani extremism under the Framework for Cooperation on Countering Terrorism and Violent Extremism (2018) signed between the two countries.
Economic and trade relations: Resume negotiations on trade agreements (e.g., CEPA) to rebuild economic ties, investment flows etc.
Engage diaspora: Both countries should encourage diaspora and Track-II diplomacy channels to build on people-to-people ties, cultural exchanges, and dialogues and conflict resolution efforts.
Strategic interest: Need to strengthen cooperation in key strategic interests such as countering China in the Indo-Pacific region, and emphasising freedom of navigation and rule-based order.