In a significant move to strengthen bilateral ties, Prime Minister Mark Carney announced his intention to finalise a comprehensive trade agreement with India by the end of 2023. Speaking at the Canada-India Growth and Investment Forum held in Mumbai, Carney emphasised the importance of this agreement as a testament to the revival of diplomatic relations between Canada and the populous South Asian nation of 1.4 billion people.
A New Chapter in Canada-India Relations
Addressing an audience of approximately 100 business leaders and investors in Mumbai’s bustling financial hub, Carney articulated his vision for a rejuvenated partnership with India, marking the end of a “challenging period” for Canada-Indian relations. He described this moment as the dawn of a “more ambitious partnership” with the world’s fifth-largest economy.
The Prime Minister underscored the changing global landscape, citing the breakdown of the established rules-based international order and the emergence of a more unpredictable global environment where economic coercion is increasingly wielded by dominant powers. He noted that many nations, including India, are recognising the necessity for “strategic autonomy” in their foreign policy, allowing them to engage with multiple global players while prioritising their own national interests.
Emphasising Strategic Autonomy
Carney explained that India’s foreign policy, characterised by “strategic autonomy,” allows the country to navigate its relationships with competing global powers without aligning itself with any singular bloc. He stated, “Building true strategic autonomy requires diversification, not isolation,” suggesting that this principle opens up vast opportunities for collaboration between Canada and India.
In a nod to the differing foreign policy approaches of the two nations, Carney acknowledged that cooperation is possible even amidst disagreements. For instance, while India maintains a friendly rapport with Russia, Canada has committed over £25 billion to support Ukraine following Russia’s invasion in 2022. This divergence highlights the complexities and nuances of international relations today, which Carney believes require a pragmatic and values-based approach.
Promoting Canada’s Economic Potential
During his address, Carney also showcased Canada’s economic strengths, particularly its rich energy resources and favourable tax environment. He touted a new “super-deduction” programme that offers a 100 per cent tax write-off for various investments, including clean energy and electric vehicles.
With an anticipated increase of 50 million tonnes in Canada’s liquefied natural gas exports to Asia in the coming years, he emphasised that Canada is well-positioned to be a strategic partner in critical minerals needed for India’s burgeoning manufacturing, clean technology, and nuclear industries. Currently, Canadian exports to India account for less than 1 per cent of the country’s overall exports, which Carney believes is far below their potential.
The Path Ahead
Carney further highlighted the deep-rooted connections between Canada and India, noting that approximately two million Canadians have Indian ancestry, including prominent figures across various sectors. He remarked, “We can be India’s strategic partner in critical minerals for India’s manufacturing, clean tech, and nuclear industries. And India can help us double our grid with clean power by 2040.”
This vision of cooperation extends to advancements in artificial intelligence and the digital economy, which align closely with Canada’s aspirations to enhance its own capabilities in these areas.
Why it Matters
The proposed trade agreement between Canada and India signifies not merely an economic partnership but also a strategic alignment that could reshape the geopolitical landscape. As both nations navigate the complexities of global power dynamics, their collaboration may serve as a model for other countries seeking to diversify their international relationships. By embracing mutual interests and leveraging shared resources, Canada and India have the potential to not only boost their respective economies but also contribute to a more stable and prosperous global order.