Sales of Canadian lentils in India have slumped since Canadian Prime Minister Justin Trudeau last week said he suspected Indian involvement in a killing on Canadian soil, fearing reprisal from New Delhi that could limit trade, citing industry sources in both countries Reuters stated. Canada is India's main import source of lentils, a protein-rich staple used to make daal curry.
Justin Trudeau said that Canada was "actively pursuing credible allegations" linking Indian government agents to the murder of a Khalistani separatist leader in British Columbia in June. India's foreign ministry called the allegations "absurd."
Reduced Indian purchases would likely cut the prices Canadian farmers receive during harvest. But such a move could also inflate India's domestic food prices, which would be politically risky ahead of a national election next year. After a drop in output, India banned wheat exports last year, followed by a ban on non-basmati white rice this year to preserve supplies of those staples.
"Industry officials are concerned that there could be trade restrictions by the governments owing to current tensions between the countries," said Nitin Gupta, senior vice president of Olam Agri India, a major importer. There are no such plans by India and Delhi has not instructed importers to refrain from purchases, said a senior Indian government official, declining to be named due to the sensitivity of the situation.
Meanwhile, Delhi traders' body CTI on Monday urged the Centre to ban import of lentil (masur) from Canada, over Ottawa's allegations relating to the killing of a Khalistani separatist on Canadian soil. In a letter to Union Commerce Minister Piyush Goyal, the Chamber of Trade and Industry (CTI) said that there was a need to exert economic pressure on Canada.
Chairman of CTI, Brijesh Goyal, said that the development has sent ripples through the business world. Indian traders have demanded that India should ban import of lentils from Canada, which is a major supplier. "Canada is becoming a stronghold of Khalistanis and their anti-India sentiment was displayed by protests at the Indian embassy. However, Trudeau is making politically motivated statements in view of upcoming elections in Canada," he said.