Are India - Canada Relations In a State of Downturn?

Canada and India are indeed well-suited to be strategic partners. Vibrant democracies and multicultural English-speaking societies, both nations are members of the Commonwealth, G20, and ARF (ASEAN Regional Forum), to name a few, and have a broad commonality of outlook.

5 min read
Are India - Canada Relations In a State of Downturn?

Canada and India are indeed well suited to be strategic partners. Vibrant democracies and multicultural English-speaking societies, both nations are members of the Commonwealth, G20, and ARF (ASEAN Regional Forum), to name a few, and have a broad commonality of outlook. The two countries have complementary economies. Canada has been home to the Indian diaspora since the late 19th century. Currently, 1.9 million PIOs (People of Indian Origin) comprise some 5.6% of the Canadian population. Their number is growing steadily. For good or bad, youngsters seem to compete in parts of India, especially Punjab, to migrate to Canada. Canada is the only OECD country, which absorbs some 350,000 immigrants (close to 1% of its population) every year. The largest number comes from India. The Indian community has carved out a niche for itself by its diligence, language skills, and educational prowess. Many of them occupy senior positions in the educational, financial, business, official and political spheres. A number of them have become dollar billionaires, notwithstanding their humble origin. But, India and Canada are trying to revive momentum in their bilateral relations which had drifted for a while due to differences over activities of Khalistani extremists.

India and Canada share a chequered history and the ties between the two nations have seen their fair share of ups and downs. Since India’s Independence, Canada has recognized the country as a major power in Asia that was crucial in maintaining the balance of power in the region. Canada’s association with the British Commonwealth, its federal democratic character, and its rich ethnic diversity laid the foundations for bilateral relations between India and Canada. Ottawa believed that enhanced ties with India would allow Canada to extend its reach to other Afro-Asian countries and pursue its foreign policy in relative autonomy. Canada further sought to position itself as a “bridge” between the US and India, i.e. to moderate the US’ views about India and vice versa. During the Cold War period, the personal equation between Indian Prime Minister Jawaharlal Nehru and his Canadian counterparts, Louis St. Laurent and later Lester Pearson, helped develop some strategic understanding between the two sides. During this period, India became the largest recipient of Canadian external assistance. Under the Colombo Plan, Canada provided grants to India’s civil nuclear program, which it believed would highlight the importance of the peaceful use of nuclear energy. Moreover, Canada’s assistance was aimed at furthering bilateral cooperation by encouraging mutually beneficial research and industrial activities in both countries. However, Canada’s status as a founding member of the North Atlantic Treaty Organization (NATO) was at odds with India’s Non-Aligned Movement (NAM) membership and its aim to maintain strategic neutrality between the two Cold War blocs.

Faultlines first emerged in 1948 when Canada supported a plebiscite, followed by a ceasefire, in the Indian state of Kashmir, a position that was antithetical to India’s interests. Differences over other issues of international importance further deepened the gulf between India and Canada. John Diefenbaker’s Conservative Party-led government in Canada was considered to be closer to Pakistan under the leadership of Ayub Khan than to India. In 1974, foreign-policy mandarins in Ottawa were infuriated when India carried out nuclear tests. They suspected that these tests were carried out using the Canadian CIRUS reactor. Out of three research reactors India had, only the Canadian-designed and cooperatively built CIRUS provided for plutonium, a prerequisite for developing nuclear bombs. Up until then, Canada had believed that New Delhi shared its ideological opposition to the development of nuclear weapons. The Indian nuclear tests challenged this notion, making Canada reassess its perception of Asia’s emerging strategic dynamics. India subsequently conducted nuclear tests in Pokhran, Rajasthan in 1998, driven by a range of domestic and external incentives such as the emerging consensus between India’s political elites and the scientific community; the security threat posed by China, in light of the 1962 Sino-Indian war; and China’s nuclear tests in Lop Nor. In the aftermath of the nuclear tests, India’s relations with Canada, and indeed much of the West, deteriorated. Canadian politicians, especially the Liberals and NDP (headed by Jagmeet Singh, an unabashed India baiter) are beholden to the Khalistani elements and often make an appearance at separatist platforms, where terrorists like Bhindranwale are eulogized. New Delhi has been raising its concerns with Ottawa regularly, which pleads helplessness due to the right of free speech, under the Canadian constitution. They also point out that under the constitution a province like Quebec has a right to secede if a majority of the electorate casts an affirmative vote.

India’s decision to put off the foreign office consultations scheduled with Canada signals the downturn in political ties between the two countries over PM Trudeau’s remarks on the farm protests. In an open letter, a group of former Indian diplomats lashed out at Trudeau, saying such blatant interference in India's internal affairs to appease a section of the Liberal party's voter base is completely unacceptable and will cast a long shadow on bilateral relations. Expressing concern over activities of pro-Khalistan elements in Canada, the statement said they are also radicalizing the Canadian youth with far-reaching consequences, which is being ignored at the altar of short-term political expediency. An upset New Delhi promptly summoned the Canadian envoy over the “unwarranted” comments and served a demarche or formal diplomatic representation that said the “comments by the Canadian Prime Minister, some Cabinet Ministers and Members of Parliament on issues relating to Indian farmers constitute an unacceptable interference in our internal affairs”. Indian officials, however, underlined that economic relations between the two countries would not be impacted by the strain in political ties that were often attributed to the Canadian leadership letting local political interests of his party gain precedence over diplomacy and economics.

Despite their tumultuous political history, India remains Canada a viable option for robust economic partnership. In recent years, Canada has expedited the efforts to diversify its trading partners, driven by the search for new opportunities and avenues for investment beyond the Western hemisphere. This motivates it to explore the possibilities of augmenting trade and economic relations with India. India-Canada relations have struggled to prosper, despite the two countries sharing various complementarities such as their democratic character and association in the Commonwealth. Starting with ideological differences in the Cold War period and later, Canada’s inability to take into consideration India’s strategic realities, the differences have festered between the two sides. India’s Canada policy, on the other hand, has partly been informed by the presence of Khalistan sympathizers who espouse anti-India sentiments. Canada’s criticism of New Delhi has dented India’s interest in engaging Canada as a strategic partner. These criticisms have come at various levels, including provincial legislatures, involving past events such as the military action in Amritsar’s Golden Temple and the 1984 riots.

Even so, India’s economic potential, including the investment opportunities it offers, has led Canada to periodically review the economic dimension of this bilateral relationship in its India policy. For India to overcome the longstanding hiatus in its relations with Canada, it must divert its attention away from politically contentious issues. New Delhi should also take into consideration that past events affecting the Sikh diaspora in Canada have gradually become part of the political discourse there. It is, therefore, useful to develop a new framework of cooperation that is more pragmatic. it is time to put more emphasis on mutually beneficial areas, such as trade, where opportunities lie. Much work remains to be done.


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