India Canada relations

IN NEWS:

• Indo-Pacific cooperation and trade were at the top of the agenda as Canadian Foreign Minister met with External Affairs Minister recently for the India-Canada Strategic Dialogue in Delhi.
• The visit is seen as an attempt by both sides to put bilateral ties back on track, after several turbulent years, and focused primarily on Canada’s newly released Indo-Pacific strategy that calls India an important partner.

HISTORY:

• Canada and India have longstanding bilateral relations built upon shared traditions of democracy, pluralism and strong interpersonal connections.
• During the colonial period, Canada was an important destination for migrants from India.
• During the Cold War period, the personal equation between Indian Prime Minister Jawaharlal Nehru and his Canadian counterparts helped develop some strategic understanding between the two sides.
• During this period, India became the largest recipient of Canadian external assistance. Canada provided food aid, project financing and technical assistance. For instance,
  • Under the Colombo Plan, Canada provided grants to India’s civil nuclear programme. The ‘Canada India Reactor Utility Services (CIRUS)’ went critical in July 1960.
  • In the 1960s and 70s, Canada supported projects such as the Kundah power house project in Tamilnadu and the Idukki Dam in Kerala.
• However, following India's Smiling Buddha nuclear test of 1974 and the bombing of the Air India Flight 182 by separatists, Indo-Canadian relations deteriorated.
• But the cessation of Cold War hostilities and the LPG reforms of 1990s paved the way for rekindling the relationship.

AREAS OF COOPERATION:

• Political:
  • At the Ministerial level, Canada and India enjoy a strategic partnership underpinned by Ministerial Dialogues on foreign policy, trade and investment, finance, energy.
  • At the official level, there are regular working groups that focus on counter-terrorism, security, agriculture, education, science and technology.
  • India and Canada have also established a Track 1.5 Dialogue on involving experts, government officials and business leaders from both sides to explore the possibility of future cooperation.
• Economic:
  • Trade:
    • Bilateral trade in goods amounted to USD 6.73 billion in 2019-20 (India's exports: USD 2.85 billion and India's imports: USD 3.88 billion). The bilateral trade in Services in 2019 was USD 3.10 billion.
    • Canada and India are working toward a Comprehensive Economic Partnership Agreement and a Foreign Investment Promotion and Protection Agreement (FIPA).
  • Investment:
    • Canada is the 19th largest foreign investor in India with a cumulative investment of USD 3.2 bn from April 2000 to September 2022. India has also emerged as an attractive investment destination for several Canadian pension funds.
  • Developmental assistance:
    • Global Affairs Canada provide development assistance to India through Indian and Canadian Non-Governmental Organizations, and through multilateral mechanisms such as the World Bank and the Asian Development Bank.
• Strategic:
  • In late 2022, Canada released an Indo-Pacific strategy which called India a “crucial partner” and termed China an “increasingly disruptive” global power. The strategy states that Canada will seek new opportunities to partner and engage in dialogue with India in areas of common interest.
  • The strategy also contains funding commitment on infrastructure projects through the US-led G7 Partnership for Global Infrastructure and Investment, an enhanced military presence including a third frigate in the Indian Ocean, and expanded participation in regional military exercises.
• Multilateral:
  • India and Canada collaborate closely in international fora, particularly through the UN, Commonwealth and G-20.
• Security and defence:
  • Defence ties have been expanding with mutual ship visits. There is also robust cooperation on counter terrorism issues particularly through the framework of the Joint Working Group (JWG) on Counter Terrorism.
  • The security cooperation was further enhanced with the Framework for Cooperation between India and Canada on Countering Terrorism and Violent Extremism signed in February 2018.
• Science and technology:
  • Nuclear Cooperation:
    • A Nuclear Cooperation Agreement (NCA) with Canada was signed in June 2010 and came into force in September 2013.
    • In 2015, Department of Atomic Energy (DAE) and Canada’s Cameco Corporation signed an agreement for supply of uranium ore concentrate to India in 2015-2020.
  • Space:
    • ISRO and Canadian Space Agency have signed MOUs in the field of exploration and utilisation of outer space.
    • ISRO and ANTRIX, the Commercial arm of ISRO, have launched several Canadian satellites. Eg: Canada’s first LEO satellite was launched by the PSLV from Sriharikota in 2018.
  • Agriculture:
    • The bilateral MoU on agriculture cooperation was signed at the federal level in 2009. A Joint Working Group for Pulses has been set up separately.
  • Energy Cooperation:
    • In February 2018, the scope of the Energy Dialogue was expanded to additionally include electricity, energy efficiency and renewable.
    • India Oil Corporation has a 10% participating interest in a Liquid Natural Gas project in British Columbia.
  • Arctic research:
    • Department of Earth Science and Polar Canada have started a programme for exchange of knowledge and scientific research on Cold Climate (Arctic) Studies.
• Capacity building:
  • Education is a key area of mutual interest. Recently, India became the top source of foreign students studying in Canada.
  • Canada’s Foreign Service Institute (CFSI) has undertaken training initiatives to Indian diplomats at FSI, New Delhi on Bilateral & Multilateral Negotiation and Diplomacy and Global Affairs including Canada’s Foreign Policy Approach.
• Cultural:
  • Canada is home to one of the largest communities of Indian origin, with approximately 4% of Canadians being of Indian heritage.
  • Canada was the first western democratic nation to celebrate Diwali officially in Parliament. Diwali has been celebrated on the Parliament Hill since 1997.
  • There are institutions like the Shastri Indo-Canadian Institute (SICI) for fostering education and cultural cooperation and collaboration between India and Canada.
• Diplomatic:
  • In India, Canada is represented by the High Commission of Canada in New Delhi beside Consulates General in Bengaluru, Chandigarh and Mumbai.
  • India is represented in Canada by a High Commission in Ottawa and by consulates in Toronto and Vancouver.
• Connectivity:
  • There are direct flights between Indian and Canadian cities. Indian and Canadian carriers have also expressed interest in expanding their business in the other country.
  • India and Canada have recently finalised an expanded air transport agreement. This could further boost connectivity between the two nations.

AREAS OF CONCERN:

• Canadian tolerance for separatists:
  • Khalistan activism is strong in Canada. But its inability to assuage Indian concerns regarding the same has made New Delhi apprehensive of its ties with Ottawa.
  • Eg: In October, 2022, India served the Canada High Commission a demarche, expressing discontent and urging the Canadian government to stop the Khalistan referendum.

• Rising violence:
  • Instances of vandalism of temples, hate crimes and sectarian violence against Indian nationals have been on the rise in Canada.
• Lack of clear policy:
  • Despite the apparent interest in furthering its relations with India, there is lack of a clear plan of action and policy on the part of Ottawa to effectively engage with India.
• China factor:
  • Despite its criticism, Canada has stronger relations with China, partly due to its expansive trade relations with Beijing.
  • This is evident from the fact that while Canada has engaged with China on issues ranging from extradition, free trade and cyber-security cooperation, it does not accord the same treatment to its relations with India.
• Lack of concern for Indian sensitivities:
  • On many occasions, Canada has shown a lack of concern for Indian sensitivities and interfered in India’s internal affairs.
  • For instance, in December 2020, Canadian PM raised concerns about the handling of farmer protests by India. In response, the Indian Ministry of External Affairs stated that PM’s comments were "an unacceptable interference in our internal affairs".
• Low levels of trade:
  • While India–Canada economic relations have made some progress, Canada remains an insignificant trading partner for India compared to compared to other North American countries, particularly USA and Mexico.
• Challenges in FTA negotiations:
  • The trade negotiations are stuck on two crucial factors. India is asking for further flexibility on freer movement of professionals, while Canada wants a specific cut on fruits and vegetable — a concession India is unwilling to offer, given the vulnerability of its farming sector.

CONCLUSION:

Both countries need to overcome the longstanding hiatus in their relations. For this, they should look beyond politically contentious issues and seek to develop a new framework of cooperation that is more pragmatic and emphasise on mutually beneficial areas like trade. In this regard, Canada’s Indo-Pacific strategy and the decision to relaunch the negotiations on CEPA offers a window of opportunity.

PRACTICE QUESTION:

Q. Despite sharing complementarities, India-Canada relations have struggled to prosper. Analyse the reasons for the same and suggest measures to strengthen India-Canada relations.

Q. ‘Indian diaspora has a decisive role to play in the politics and economy of America and European Countries’. Comment with examples. (GS 2, CSE 2020)