The victory of Mark Carney’s Liberal Party is expected to improve the strained bilateral ties between New Delhi and Ottawa. In fact, in his campaign, Carney had identified rebuilding ties with India as a priority.


"What Canada will be looking to do is to diversify our trading relationships with like-minded countries, and there are opportunities to rebuild the relationship with India. There needs to be a shared sense of values around that commercial relationship, and if I am Prime Minister, I look forward to the opportunity to build that," he had said, as reported by media.


India and Canada’s ties suffered in 2023 after the Trudeau government’s accusations that "Indian agents" were involved in the killing of Hardeep Singh Nijjar, a Canadian citizen and a Khalistani terrorist, outside a gurdwara in Surrey, British Columbia, in June 2023. India has denied the allegations.


Tensions flared again in October of the same year after Canada expelled six Indian diplomats. Both nations expelled top envoys, froze trade negotiations, and suspended official visits. India has accused Canada of tolerating extremism among Canada's Sikh diaspora and accommodating separatist rhetoric.


Education & Economy


India remains one of the largest sources of immigration to Canada, with the Indo-Canadian community and overseas Indians numbering nearly 2.8 million across categories such as temporary workers, students, and permanent residents. Indian students alone, estimated at over 427,000, play a big role in Canada's education and labour market.


Carney, who was called a threat to Canadian autonomy by the US President Donald Trump, has talked about diversifying Canada's trade relationships. He has named India as a key partner.


One of the major casualties of the diplomatic standoff was the Comprehensive Economic Partnership Agreement (CEPA) between Canada and India. In 2023, bilateral services trade reached CAD 13.49 billion. Both countries had previously explored deeper collaboration in areas like artificial intelligence, fintech, green energy, and higher education.


Reset In India-Canada Ties


With Carney at the helm, these sectors could see renewed momentum, particularly as Canada and India seek to diversify economic ties away from reliance on China and the United States.


In recent months, security officials from India and Canada have re-established communication, with both countries exploring the possibility of appointing new high commissioners. The departure of Prime Minister Justin Trudeau is being viewed in New Delhi as an opportunity to reset bilateral relations.


India had previously accused Trudeau’s administration of providing space for pro-Khalistani groups to operate from Canadian territory. Following his exit, the Indian government expressed hope for rebuilding ties based on "mutual trust and sensitivity".


"The downturn in India-Canada relations was caused by the licence that was given to the extremist and secessionist elements in that country," MEA Spokesperson Randhir Jaiswal had said in March this year.


Expectations From Carney


Mark Carney, 60, a former governor of both the Bank of Canada and the Bank of England, has centred his campaign on national sovereignty and a recalibration of Canada’s foreign alliances in response to escalating tariff threats from its largest trading partner, the United States.


Carney has been outspoken in his criticism of former US President Donald Trump, calling him a direct threat to Canadian autonomy. “Donald Trump wants to break us so America can own us,” he said in one of his most widely quoted remarks. He identified India as a key strategic partner as part of his strategy to diversify Canada’s trade relationships.


Despite recent tensions, Carney has reiterated that Canada must pursue commercial ties with nations that share democratic values. In that context, he maintains that India remains a vital part of Canada’s future trade and foreign policy agenda.