When Prime Minister Narendra Modi and his Canadian counterpart Mark Carney met on Sunday (November 23), on the sidelines of the G20 Leaders’ Summit in Johannesburg, they indulged in more than a diplomatic handshake. They relaunched a high-stakes trade engagement: agreeing to kick off negotiations for a “high-ambition” Comprehensive Economic Partnership Agreement (CEPA), targeting a bilateral trade volume of $50 billion by 2030.
The figure is more than double the current trade volume of $23.66 billion. It also comes after two years of stalled negotiations, underscoring a decisive reset and upgrade in India–Canada trade engagement.
“The India–Canada partnership continues to be grounded in mutual trust, democratic values and a shared commitment to development. CEPA reflects the trust between the two countries, strengthens investor confidence and provides a robust framework for addressing issues based on mutual respect,” Union commerce and industry minister Piyush Goyal said on November 24.
India and Canada entered a nearly two-year freeze after Canada alleged Indian involvement in the 2023 killing of Sikh separatist Hardeep Singh Nijjar, a charge New Delhi strongly denied. The fallout led to a sharp downturn in political dialogue, suspension of trade talks and a halt in progress on the CEPA framework.
With diplomatic engagement gradually normalising in 2025, both sides have now moved to restore high-level political contact and resume economic negotiations.
Why does it matter to India?
A trade push can also deepen investment ties, strengthen supply chains and secure access to critical minerals and nuclear fuel needed for clean energy and manufacturing, a government official privy to the development told Moneycontrol.
“With negotiations restarting after two years, the partnership has a chance to shift from basic goods trade to a more strategic, long-term economic arrangement aligned with India’s global trade ambitions,” the official said.
It also fits into India’s wider trade strategy of expanding trade agreements with developed economies — similar to its trade talks with the US, UK, EU and the UAE — to gain better market access and technology partnerships.
For India, working more closely with countries like Canada can support growth in new areas such as AI, quantum computing and data centre development, while also reducing dependence on single-country supply sources, Union minister Goyal told the Indo-Canadian business community on November 24.
Critical minerals and nuclear energy
With India looking to expand domestic manufacturing in batteries, electronics and clean energy, New Delhi is seeking stable and diversified access to minerals such as lithium, cobalt and nickel. Canada, which has sizeable reserves and established processing capabilities, is likely to partner to support India’s push to build resilient supply chains and reduce reliance on a limited set of supplier nations.
Civil nuclear cooperation is another area where both sides are looking to deepen ties. As India scales up nuclear power to support low-carbon electricity generation, long-term availability of fuel remains a priority. Canada has previously supplied uranium to India, and both governments have signalled their intent to strengthen this arrangement as part of a broader energy partnership.
What Canada stands to gain?
Canada sees renewed trade with India as a chance to diversify beyond its heavy reliance on the US market. Earlier this month, Canadian trade minister Sidhu said his country saw multiple new areas of opportunity for collaboration with India, particularly in investments, aerospace, artificial intelligence, critical minerals, energy, and agriculture. He further said that Canada had all the key components required to build an electric-vehicle battery and was keen to attract investment from Indian companies, adding that Canada possessed the necessary resources and was ready to work jointly to expand supply chains in these sectors.
India’s commerce minister Goyal said India has a “strategic advantage” because of its large pool of STEM graduates, which can help Canada bridge its skilled-worker shortages and support growth in advanced industries like AI, clean energy and EVs.
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