Canada’s diplomatic ties with India have deteriorated significantly. On Monday, Canada expelled a senior Indian diplomat as part of its investigation into what Prime Minister Justin Trudeau has characterized as credible accusations connecting the Indian government to the assassination of Khalistani terrorist Hardeep Singh Nijjar in Canada. Trudeau informed the Canadian Parliament that the country’s intelligence agencies have been actively examining these allegations since Nijjar was fatally shot on June 18 outside a Sikh cultural center in Surrey, British Columbia.
As tensions continue to rise, there are significant apprehensions about the future of India-Canada trade relations. Canada holds the 18th position among foreign contributors to India’s economy, with investments totaling approximately $3.3 billion from April 2000 to March 2023. This Canadian investment constitutes roughly 0.5 percent of the total foreign direct investment (FDI) received by India during this period. Moreover, in 2022, India ranked as Canada’s ninth-largest trading partner. Notably, the services and infrastructure sectors jointly represented a substantial portion, accounting for 40.63 percent of the overall FDI inflow from Canada into India.
Canadian Prime Minister Justin Trudeau has underscored the seriousness of the situation, characterizing the murder of an Indian separatist leader in another country as “extremely grave.” These remarks came after his assertion that “credible allegations” had linked Indian agents to the June killing of Hardeep Singh Nijjar. However, New Delhi has rejected the allegations made by the Canadian government as “baseless.”