India, Canada relaunch free trade talks after 2023 diplomatic chill
Union Commerce and Industry Minister Piyush Goyal and Canadian International Trade Minister Maninder Sidhu signed the Terms of Reference (ToR) for the agreement in New Delhi. The documents were shared in the presence of Prime Minister Narendra Modi and Canadian Prime Minister Mark Carney at Hyderabad House.
Minister (East) P Kumaran said earlier in the day that both sides agreed on a broad deadline to finalize the deal by the end of 2026.
Prime Minister Modi said that the two countries have set a target of increasing bilateral trade to $50 billion by 2030 and have decided to finalize CEPA soon to unlock the full potential of economic cooperation. His Canadian counterpart, meanwhile, said the agreement reflects the expansion of a valuable partnership with new ambition, focus and foresight between two self-reliant countries shaping their future trajectories.
The ToR will define the structure and pace of negotiations and guide discussions to conclude an ambitious and balanced trade agreement. The agreement will cover goods, services and other mutually agreed areas.
The resumption of talks follows a diplomatic freeze in 2023 that slowed trade talks and led to broader participation. Kumaran said relations were now “much better” than they were at their lowest during that period. Both countries have installed their High Commissioners (Dinesh K. Patnaik of India and Christopher Cooter of Canada) and are gradually increasing their diplomatic staff strength to pre-2023 levels.
Referring to Carney’s February 27-March 2 visit, Kumaran said, “This was his first visit to India since taking office and the first bilateral visit by a Canadian Prime Minister in eight years. The visit marks an important milestone in the India-Canada relationship.” To sustain momentum beyond political cycles, both parties have revitalized and launched institutional platforms. The India-Canada CEO Forum was reconstituted and convened in New Delhi on March 2. A new Economic and Financial Dialogue was also established at ministerial level to facilitate capital flows and investment cooperation.
Kumaran said the visit saw trade announcements and investment commitments in pharmaceuticals and life sciences, agri-food processing, clean technology and water infrastructure, financial services and fintech, advanced manufacturing, hospitality and digital innovation.
He added that investments are increasingly covering next-generation sectors such as regenerative medicine, artificial intelligence-supported banking, cyber security, clean energy technologies and advanced industrial solutions.
Energy security and critical minerals also came to the fore. During the talks, long-term uranium supply arrangements for India’s nuclear sector and cooperation on lithium and cobalt were discussed. Both sides aim to deepen cooperation in infrastructure, capital markets and corporate investments.
Since then, both sides have moved to stabilize relations and restore economic dialogue. The decision to finalize the specification followed talks between the two leaders on the sidelines of the G7 meeting in Kananaskis, Canada, in October 2025, where they agreed to continue work on the CEPA framework.
Bilateral trade between India and Canada stood at $8.66 billion in Fiscal Year 2024-25. According to official data, India exported goods worth $4.22 billion and imported $4.44 billion.
India’s major exports to Canada include pharmaceuticals, iron and steel, seafood, cotton garments, electronic products and chemicals. Major imports from Canada include pulses, coal, fertilizer, paper and crude oil. In the field of services, India exports telecommunications, computer and information services and other business services.
Canada is home to more than 425,000 Indian students and a large Indian community, making people-to-people ties a central pillar of the relationship.
