The discussions between India and Canada on the free trade agreement (FTA), which restarted after a decade, have reportedly come to an end owing to political concerns.

The official stated that talks would restart after the “political issues” had been settled without specifically mentioning the issue, which caused friction between the two nations.

“On September 10, Prime Minister Narendra Modi conveyed to his Canadian counterpart Justin Trudeau India’s strong concerns about the continuing anti-India activities of extremist elements in Canada that were promoting secessionism, inciting violence against its diplomats, and threatening the Indian community there,” according to PTI.

Important trade figures between India and Canada

image credit:economictimes

Canada is the 18th largest foreign investor in India, according to Invest India, with total investments of around $3,306 million between April 2000 and March 2023. So, of all the FDI (foreign direct investment) inflows into India, Canadian investment accounted for roughly 0.5%. In 2022, India ranked as Canada’s ninth-largest trading partner. Together, services and infrastructure accounted for 40.63% of all FDI investments made by Canada in India.

According to Invest India, over 1,000 Canadian businesses are actively looking to expand into the Indian market. Over 600 Canadian businesses have a presence there.

According to information held by the Ministry of Commerce, India’s total exports to Canada were $4,109.74 million in FY23 or 0.9% of the $450,958.43 million total exports of India during the previous fiscal year.

On the other side, according to data from the Ministry of Commerce, India’s total imports from Canada in FY23 totaled $4,051.29 million, or around 0.6% of the country’s overall imports of $714,042.45 million.


According to a PTI article, India sells equipment, gems, jewelry, textiles, and medicines to Canada, while Canada sends pulses, lumber, pulp and paper, and mining goods to India.

In terms of personal remittances, the World Bank reports that India got close to $859.83 million in remittances from Canada in 2022.

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Trade between India and Canada may not be affected.

According to a PTI article, analysts say that since economic connections between India and Canada are motivated by business interests, the recent escalation of hostilities is unlikely to have an effect on commerce or investments between the two nations.

Experts point out that because India and Canada trade in complementary goods rather than comparable ones, these occurrences may not have an impact on their economic ties.