Canada’s Carney to Mend Rift, Boost Trade as He Meets PM Modi

Talks in New Delhi are expected to cover trade and investment, clean energy, defence, critical minerals and artificial intelligence, officials from both sides said.

The main focus of the meeting will be the revival of negotiations on the long-discussed Comprehensive Economic Partnership Agreement.

Speaking to business leaders in Mumbai on Saturday, Carney said the agreement, which he plans to sign by the end of the year, could double bilateral trade by 2030.

“This visit marks the end of a difficult period and, more importantly, the beginning of a new, more ambitious partnership between two self-confident and complementary countries,” he said.

Carney’s visit is a significant step forward in relations that effectively collapsed in 2023 after Ottawa accused New Delhi of orchestrating a deadly campaign against Sikh activists in Canada.

India’s foreign ministry said Carney’s visit was an “important step” in strengthening relations.

India is looking to attract more overseas investment and says Canadian pension and wealth funds have already invested $73 billion.

Energy-hungry India, the world’s most populous country with 1.4 billion people, is hoping Canada can support its ambitious plan to increase its nuclear energy capacity.

– ‘Strategic partner’ –

“We can be India’s strategic partner for critical minerals for India’s manufacturing, clean technology and nuclear industries,” Carney said.

“And India can help us double our grid with clean energy by 2040.”

Before Carney took office last year, Ottawa accused the Modi government of directly intervening in the 2023 murder of Canadian citizen Hardeep Singh Nijjar, who was part of a fringe group advocating for an independent Sikh state called Khalistan.

Khalistan militants were blamed for the assassination of the Indian prime minister and the bombing of a passenger plane.

Former prime minister Justin Trudeau’s government also alleged that India was waging a broader campaign of intimidation against Sikh activists across Canada.

India has repeatedly denied the allegations, which have sent relations into freefall with both countries expelling a number of top diplomats in 2024.

Strategic analyst and author Brahma Chellaney said Carney’s trip was “aimed at closing one of the most acrimonious diplomatic chapters between two major democracies in recent times.”

“This may be the most sustainable basis for two pluralist democracies moving forward in an uncertain century,” he said in X.

Ties between New Delhi and Ottawa improved after Carney took office in March 2025, and envoys have since been re-established.

– ‘Tremendous opportunities’ –

“Building true strategic autonomy requires diversification, not isolation,” Carney said.

“Working together creates tremendous opportunities for India and Canada to limit risks, increase prosperity and build sovereignty.”

Carney has made reducing Canada’s over-reliance on the U.S. economy the centerpiece of his foreign economic policy.

By 2024, before U.S. President Donald Trump returned to office and roiled global trade with a series of tariffs, more than 75 percent of Canadian exports were destined for the United States. That year, two-way trade exceeded $900 billion.

So far, Trump has largely stuck to the North American free trade agreement he signed in his first term, and about 85 percent of U.S.-Canada trade remains duty-free.

But Trump has also imposed painful industry-specific tariffs and there are fears that Canada’s economy will be hit hard if he cancels the broader trade deal.

Carney is trying to increase trade with Europe and Asia as a strategy to bolster Canada’s economy if free trade with Washington collapses.

After India, Carney will travel to Australia and Japan as part of a broader initiative to expand Canada’s economic partnerships.