Economics above politics? India and Canada to resume trade agreement talks

While their ties plunged in 2023 over the death of a Sikh separatist, they are keen to restart trade talks due to US tariffs, analysts say

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India’s Prime Minister Narendra Modi (left) and Canada’s Prime Minister Mark Carney speak before a meeting at the G7 summit in Kananaskis, Alberta, in June. Photo: AP

Published: 3:28pm, 25 Nov 2025Updated: 4:05pm, 25 Nov 2025

India and Canada have agreed to restart talks on a long-delayed free-trade agreement, in the strongest signal yet of a thaw in their relations following a two-year diplomatic row triggered by the 2023 killing of a Sikh separatist in British Columbia.

The resumption of negotiations underscores both countries’ aim to prioritise economic ties over a resolution to a lingering political issue, even as the underlying tensions over Sikh separatism remain unresolved, according to analysts.

The rapprochement follows a Sunday meeting between Indian Prime Minister Narendra Modi and his Canadian counterpart Mark Carney on the sidelines of a Group of 20 summit in South Africa, in the first meeting between the two leaders since Carney took office in March after he replaced former prime minister Justin Trudeau.

Carney, a former central banker, has made diversifying Canada’s global trade ties a key priority amid pressure from the administration of US President Donald Trump, which has imposed steep tariffs on Canadian goods and signalled it could target more sectors.

In a statement following the talks, Carney said he and Modi agreed to launch negotiations on an “ambitious” trade pact aimed at doubling two-way trade to C$70 billion (US$50 billion) by 2030.

Ties between India and Canada nosedived in 2023 after Trudeau publicly accused New Delhi of involvement in the assassination of Hardeep Singh Nijjar, a Canadian citizen and prominent figure in the Khalistan separatist movement. India has strongly denied the allegations.

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Economics above politics? India and Canada to resume trade agreement talks

.css-1c6uqr6{color:inherit;font-weight:inherit;font-size:inherit;font-family:inherit;line-height:inherit;overflow-wrap:break-word;}While their ties plunged in 2023 over the death of a Sikh separatist, they are keen to restart trade talks due to US tariffs, analysts say

While their ties plunged in 2023 over the death of a Sikh separatist, they are keen to restart trade talks due to US tariffs, analysts say