“Canada’s future is less secure than perhaps at any time in postwar history,” Bloomberg warns. The country is finding itself with less room to manoeuvre. An economy long connected to the United States is now navigating pressures from tariffs, trade disputes and a shifting political landscape.
Three-quarters of Canadian exports flow south, millions of jobs are linked to US trade, and foreign investment remains closely tied to American markets. At the same time, with complex dynamics in the west involving China and ongoing uncertainties in US policies, Canada is looking to broaden its partnerships.
That’s why warming up to India has become increasingly important. Canada’s Foreign Minister Anita Anand is in India right now, leading efforts to strengthen trade and strategic cooperation before travelling on to Singapore and Hangzhou.
Also Read: India and Canada agree on actions to expand ties
On Monday, India and Canada moved to reset their strained ties, unveiling a new roadmap focused on trade, technology, energy and security. The plan emerged after talks between External Affairs Minister S Jaishankar and his Canadian counterpart in New Delhi.
The two countries agreed to begin ministerial-level discussions on trade and investment, revive the Canada–India Ministerial Energy Dialogue to boost collaboration on renewables and critical minerals, and relaunch the Joint Science and Technology Cooperation Committee. Canada was also invited to join India’s AI Impact Summit in February, with Jaishankar urging greater participation from Canadian AI firms and researchers.
With a population of 1.4 billion, India offers not just new markets for Canadian goods and services, but also a way to diversify trade, manage external pressures, and support economic stability in a shifting global landscape. For Ottawa, Canada’s future depends on exploring new opportunities, and India is a partner too important to ignore. With nearly 1.7 million people of Indian origin living in Canada, both countries are watching these developments closely.
The US pressure cooker
For a country that has long relied on its southern neighbour, the current landscape is unnervingly precarious. The US pressure on Canadian trade has never been clearer or more punishing.
That reality was highlighted during a recent discussion hosted by Canada’s Competition Bureau, the agency responsible for monitoring economic competitiveness and curbing anti-competitive practices.
Matthew Boswell, the Commissioner of Competition, had just opened the floor to questions when Vass Bednar, head of a Canadian think tank, voiced what many were silently thinking after 47 minutes of discussion:
“Trump has declared a trade war. How are we going to calibrate, and also communicate to Canadians that there’s going to be economic pain ahead?”
The stakes couldn’t be higher. Three-quarters of Canada’s exports flow south to the US, and roughly half of all foreign direct investment in Canada originates there. Companies operate as if the border barely exists.
Bloomberg, citing the Canadian Chamber of Commerce, notes that 2.3 million Canadian jobs, more than 10% of total employment, depend on trade with the United States. According to the same Bloomberg report, tens of thousands have already been lost to President Trump’s trade actions. Even sectors that appear insulated, like Canadian crude oil exports, rely heavily on the US, while national defence remains tightly integrated into the alliance.
Also Read: US’ 100% tariff war on China could fire up India’s big gain
Tariffs as a tool
Trump’s main lever is tariffs, a 50% duty on steel and aluminum, up from zero, plus a 25% tariff on cars and trucks not made in the US. Additional tariffs on softwood lumber, kitchen and bath goods were set to rise on October 14.
Most Canadian trade is shielded by the United States–Mexico–Canada Agreement (USMCA), signed in 2018, but the deal is due for renegotiation in 2026, and as Trump’s invocation of a dubious “emergency” to justify tariffs shows, rules are applied selectively.
At the same time, Canada faces tense relations to the east and west with two of Asia’s largest economies, China and India. The stakes could not be higher. For Ottawa, the solution lies in a careful balancing act: repairing relations with India while keeping options open with the US and China.
Reuters notes that with 75% of exports going to the US, Canada remains extremely vulnerable to American trade actions. Trump’s past remarks, even joking about making Canada the 51st state, underscore the unpredictability. Meanwhile, Canadian visits to the US dropped 23% in the first seven months of 2025 compared to 2024, as people rethink travel and cross-border business activities.
China-Canada equation
While the United States applies pressure, China has responded selectively. Beijing has imposed tariffs on Canadian canola, pork and seafood. At the same time, it recently extended the deadline on its latest canola probe, suggesting a willingness to keep negotiations open, according to Bloomberg.
Under Prime Minister Mark Carney, Canada has maintained tariffs on Chinese electric vehicles, steel and aluminum, policies originally introduced under Trudeau. Public opinion on these measures is shifting. A poll by Nanos Research Group for Bloomberg found that support for EV tariffs dropped from 63% last year to 44% in 2025.
Despite these tensions, Canada's Foreign Minister Anita Anand emphasises that cooperation with China remains possible in specific areas, such as energy and climate change. “We have many Canadian businesses actively engaged in that market,” she said.
Upcoming APEC meetings and potential interactions with President Xi Jinping could create opportunities to expand Canadian energy exports, including liquefied natural gas, to Asia.
Also read: India unveils $77 billion hydro plan as China builds upstream dam
Carney’s approach is pragmatic: protect critical industries, negotiate sector-specific safeguards and prepare for the 2026 USMCA review. He has maintained tariffs on steel, aluminum and autos, even as some retaliatory measures against US digital services and imports were rolled back, according to Reuters.
Anand is taking the first concrete steps in recalibrating Canada’s trade strategy. This week, she’s visiting New Delhi, Mumbai, Singapore and Hangzhou to lay the groundwork for deeper trade and investment ties.
As she told Bloomberg, “It goes back to being a sovereign country,” underscoring that Canada’s priority is protecting its workers and businesses while navigating the delicate triangle of US, China and Canadian interests.
India is an untapped opportunity
If China is complicated, India represents both challenge and opportunity. Canada-India relations hit a severe low in 2023, when Trudeau accused the Indian government of orchestrating the murder of Khalistani separatist Hardeep Singh Nijjar on Canadian soil, a claim Prime Minister Narendra Modi denied. Court cases are ongoing in Canada and the US, and some activists say they still feel at risk.
The allegation brought trade talks to a halt. Diplomatic ties froze, high commissioners were recalled, and bilateral cooperation stalled. Even before the crisis, progress on a Canada-India trade deal had been slow. When asked when discussions might resume, Anand highlighted the groundwork that had already been laid.
“We were in a situation in 2023 where the high commissioners had been recalled and the diplomatic relationship was at a virtual standstill. Here we are in October of 2025, two years later, and we have high commissioners in place and I’m traveling to meet with Minister Jaishankar,” she said.
“We are taking a step-by-step approach on the diplomatic relationship and ensuring that we have a work plan to give to our respective leaders that they can agree on,” Anand said. She emphasised that trade discussions will follow once this framework is established, according to Bloomberg.
India has welcomed Carney’s proactive economic agenda. After Modi congratulated Carney in April 2025, the two leaders signalled a desire to strengthen the partnership and unlock opportunities for their citizens. The Canada-India Business Council expanded its Advisory Council in July 2025 to enhance collaboration in clean energy, technology, and infrastructure. Canadian delegations have participated in high-profile events such as the Toronto International Film Festival, and ongoing ministerial dialogues in Ottawa and New Delhi have emphasised early progress on trade agreements, according to the India Brand Equity Foundation.
The economic case for Canada
In 2024, bilateral trade in goods between Canada and India reached $8.6 billion, with India exporting $4.2 billion and importing $4.4 billion from Canada. Trade in services was even higher at $14.3 billion, leaving Canada with a substantial $9.3 billion deficit in services, according to the India Brand Equity Foundation.
India is now Canada’s seventh-largest trading partner across goods and services. A potential India-Canada Comprehensive Economic Partnership Agreement (CEPA) could further boost bilateral trade by $4.4–6.5 billion and increase Canada’s GDP by $3.8–5.9 billion by 2035.
Canadian companies are already well-established in India, with more than 600 operating there and bilateral commercial relations valued at $100 billion, including $70 billion in Canadian portfolio investment.
India exported 4,526 commodities to Canada in FY25, ranging from pharmaceuticals worth $540 million to electrical machinery worth $256 million. Its imports from Canada included edible vegetables ($949 million) and mineral fuels ($640 million), totaling $4.44 billion.
The potential economic upside is clear. Expanding trade with India reduces Canada’s overreliance on the US, mitigates risks from tariff tensions with China, and opens a fast-growing market for Canadian goods and services. It also strengthens Canada’s strategic positioning in the broader Indo-Pacific region (IBEF).
Political and strategic considerations
Canada’s push toward India is not just about economics; it’s also about geopolitics. Carney and Anand are showing that it is possible to pursue national interests without antagonising partners.
Anand explained, “Having a stable relationship with a major global economic player is of exceeding importance in this geopolitical environment. Canada is going to approach the relationship with China guided by one principle, acting in the best interest of Canadians.”
Diaspora activism and the Nijjar case have recently strained ties. Yet the current approach -- incremental, cautious and data-driven -- may provide the long-term stability needed to finally secure a meaningful trade agreement.
For Canada, India is more than just another trading partner. It is a strategic hedge against US protectionism, a counterbalance to China’s economic coercion, and a gateway to the wider Indo-Pacific market. The economic numbers are compelling, the political framework is slowly improving, and Canadian businesses are eager to expand.
As Anand puts it, Canada is guided by one principle in these relationships: “acting in the best interest of Canadians.” A carefully negotiated trade deal with India could deliver exactly that -- jobs, growth and a diversified economic future in an increasingly unstable global trade environment.
Three-quarters of Canadian exports flow south, millions of jobs are linked to US trade, and foreign investment remains closely tied to American markets. At the same time, with complex dynamics in the west involving China and ongoing uncertainties in US policies, Canada is looking to broaden its partnerships.
That’s why warming up to India has become increasingly important. Canada’s Foreign Minister Anita Anand is in India right now, leading efforts to strengthen trade and strategic cooperation before travelling on to Singapore and Hangzhou.
Also Read: India and Canada agree on actions to expand ties
On Monday, India and Canada moved to reset their strained ties, unveiling a new roadmap focused on trade, technology, energy and security. The plan emerged after talks between External Affairs Minister S Jaishankar and his Canadian counterpart in New Delhi.
The two countries agreed to begin ministerial-level discussions on trade and investment, revive the Canada–India Ministerial Energy Dialogue to boost collaboration on renewables and critical minerals, and relaunch the Joint Science and Technology Cooperation Committee. Canada was also invited to join India’s AI Impact Summit in February, with Jaishankar urging greater participation from Canadian AI firms and researchers.
With a population of 1.4 billion, India offers not just new markets for Canadian goods and services, but also a way to diversify trade, manage external pressures, and support economic stability in a shifting global landscape. For Ottawa, Canada’s future depends on exploring new opportunities, and India is a partner too important to ignore. With nearly 1.7 million people of Indian origin living in Canada, both countries are watching these developments closely.
The US pressure cooker
For a country that has long relied on its southern neighbour, the current landscape is unnervingly precarious. The US pressure on Canadian trade has never been clearer or more punishing.
That reality was highlighted during a recent discussion hosted by Canada’s Competition Bureau, the agency responsible for monitoring economic competitiveness and curbing anti-competitive practices.
Matthew Boswell, the Commissioner of Competition, had just opened the floor to questions when Vass Bednar, head of a Canadian think tank, voiced what many were silently thinking after 47 minutes of discussion:
“Trump has declared a trade war. How are we going to calibrate, and also communicate to Canadians that there’s going to be economic pain ahead?”
The stakes couldn’t be higher. Three-quarters of Canada’s exports flow south to the US, and roughly half of all foreign direct investment in Canada originates there. Companies operate as if the border barely exists.
Bloomberg, citing the Canadian Chamber of Commerce, notes that 2.3 million Canadian jobs, more than 10% of total employment, depend on trade with the United States. According to the same Bloomberg report, tens of thousands have already been lost to President Trump’s trade actions. Even sectors that appear insulated, like Canadian crude oil exports, rely heavily on the US, while national defence remains tightly integrated into the alliance.
Also Read: US’ 100% tariff war on China could fire up India’s big gain
Tariffs as a tool
Trump’s main lever is tariffs, a 50% duty on steel and aluminum, up from zero, plus a 25% tariff on cars and trucks not made in the US. Additional tariffs on softwood lumber, kitchen and bath goods were set to rise on October 14.
Most Canadian trade is shielded by the United States–Mexico–Canada Agreement (USMCA), signed in 2018, but the deal is due for renegotiation in 2026, and as Trump’s invocation of a dubious “emergency” to justify tariffs shows, rules are applied selectively.
At the same time, Canada faces tense relations to the east and west with two of Asia’s largest economies, China and India. The stakes could not be higher. For Ottawa, the solution lies in a careful balancing act: repairing relations with India while keeping options open with the US and China.
Reuters notes that with 75% of exports going to the US, Canada remains extremely vulnerable to American trade actions. Trump’s past remarks, even joking about making Canada the 51st state, underscore the unpredictability. Meanwhile, Canadian visits to the US dropped 23% in the first seven months of 2025 compared to 2024, as people rethink travel and cross-border business activities.
China-Canada equation
While the United States applies pressure, China has responded selectively. Beijing has imposed tariffs on Canadian canola, pork and seafood. At the same time, it recently extended the deadline on its latest canola probe, suggesting a willingness to keep negotiations open, according to Bloomberg.
Under Prime Minister Mark Carney, Canada has maintained tariffs on Chinese electric vehicles, steel and aluminum, policies originally introduced under Trudeau. Public opinion on these measures is shifting. A poll by Nanos Research Group for Bloomberg found that support for EV tariffs dropped from 63% last year to 44% in 2025.
Despite these tensions, Canada's Foreign Minister Anita Anand emphasises that cooperation with China remains possible in specific areas, such as energy and climate change. “We have many Canadian businesses actively engaged in that market,” she said.
Upcoming APEC meetings and potential interactions with President Xi Jinping could create opportunities to expand Canadian energy exports, including liquefied natural gas, to Asia.
Also read: India unveils $77 billion hydro plan as China builds upstream dam
Carney’s approach is pragmatic: protect critical industries, negotiate sector-specific safeguards and prepare for the 2026 USMCA review. He has maintained tariffs on steel, aluminum and autos, even as some retaliatory measures against US digital services and imports were rolled back, according to Reuters.
Anand is taking the first concrete steps in recalibrating Canada’s trade strategy. This week, she’s visiting New Delhi, Mumbai, Singapore and Hangzhou to lay the groundwork for deeper trade and investment ties.
As she told Bloomberg, “It goes back to being a sovereign country,” underscoring that Canada’s priority is protecting its workers and businesses while navigating the delicate triangle of US, China and Canadian interests.
India is an untapped opportunity
If China is complicated, India represents both challenge and opportunity. Canada-India relations hit a severe low in 2023, when Trudeau accused the Indian government of orchestrating the murder of Khalistani separatist Hardeep Singh Nijjar on Canadian soil, a claim Prime Minister Narendra Modi denied. Court cases are ongoing in Canada and the US, and some activists say they still feel at risk.
The allegation brought trade talks to a halt. Diplomatic ties froze, high commissioners were recalled, and bilateral cooperation stalled. Even before the crisis, progress on a Canada-India trade deal had been slow. When asked when discussions might resume, Anand highlighted the groundwork that had already been laid.
“We were in a situation in 2023 where the high commissioners had been recalled and the diplomatic relationship was at a virtual standstill. Here we are in October of 2025, two years later, and we have high commissioners in place and I’m traveling to meet with Minister Jaishankar,” she said.
“We are taking a step-by-step approach on the diplomatic relationship and ensuring that we have a work plan to give to our respective leaders that they can agree on,” Anand said. She emphasised that trade discussions will follow once this framework is established, according to Bloomberg.
India has welcomed Carney’s proactive economic agenda. After Modi congratulated Carney in April 2025, the two leaders signalled a desire to strengthen the partnership and unlock opportunities for their citizens. The Canada-India Business Council expanded its Advisory Council in July 2025 to enhance collaboration in clean energy, technology, and infrastructure. Canadian delegations have participated in high-profile events such as the Toronto International Film Festival, and ongoing ministerial dialogues in Ottawa and New Delhi have emphasised early progress on trade agreements, according to the India Brand Equity Foundation.
The economic case for Canada
In 2024, bilateral trade in goods between Canada and India reached $8.6 billion, with India exporting $4.2 billion and importing $4.4 billion from Canada. Trade in services was even higher at $14.3 billion, leaving Canada with a substantial $9.3 billion deficit in services, according to the India Brand Equity Foundation.
India is now Canada’s seventh-largest trading partner across goods and services. A potential India-Canada Comprehensive Economic Partnership Agreement (CEPA) could further boost bilateral trade by $4.4–6.5 billion and increase Canada’s GDP by $3.8–5.9 billion by 2035.
Canadian companies are already well-established in India, with more than 600 operating there and bilateral commercial relations valued at $100 billion, including $70 billion in Canadian portfolio investment.
India exported 4,526 commodities to Canada in FY25, ranging from pharmaceuticals worth $540 million to electrical machinery worth $256 million. Its imports from Canada included edible vegetables ($949 million) and mineral fuels ($640 million), totaling $4.44 billion.
The potential economic upside is clear. Expanding trade with India reduces Canada’s overreliance on the US, mitigates risks from tariff tensions with China, and opens a fast-growing market for Canadian goods and services. It also strengthens Canada’s strategic positioning in the broader Indo-Pacific region (IBEF).
Political and strategic considerations
Canada’s push toward India is not just about economics; it’s also about geopolitics. Carney and Anand are showing that it is possible to pursue national interests without antagonising partners.
Anand explained, “Having a stable relationship with a major global economic player is of exceeding importance in this geopolitical environment. Canada is going to approach the relationship with China guided by one principle, acting in the best interest of Canadians.”
Diaspora activism and the Nijjar case have recently strained ties. Yet the current approach -- incremental, cautious and data-driven -- may provide the long-term stability needed to finally secure a meaningful trade agreement.
For Canada, India is more than just another trading partner. It is a strategic hedge against US protectionism, a counterbalance to China’s economic coercion, and a gateway to the wider Indo-Pacific market. The economic numbers are compelling, the political framework is slowly improving, and Canadian businesses are eager to expand.
As Anand puts it, Canada is guided by one principle in these relationships: “acting in the best interest of Canadians.” A carefully negotiated trade deal with India could deliver exactly that -- jobs, growth and a diversified economic future in an increasingly unstable global trade environment.
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