The shadow of increasing diplomatic tension between India and Canada is deepening on the economic relations between the two countries. Trade talks have come to a halt due to rising tensions regarding the free trade agreement between the two countries.
According to the government’s Invest India portal, bilateral trade in goods between Canada and India stood at US $ 8.16 billion in the financial year 2022-23. Total exports from India to Canada were $4.11 billion while imports were $4.05 billion.
Canada is the 18th largest foreign investor in India. A total of $3.3 billion was invested in India from Canada between April 2000 and March 2023. Canada’s share is only 0.5% of the total FDI in India. Canadian pension funds have invested US$55 billion in India.
Just a few months before tensions escalated, the sixth round of Ministerial Dialogue on Trade and Investment between India and Canada was held in Ottawa in May this year in which mutual Agreed on expanding business Was made.
More than 600 Canadian companies do business in India and more than 1,000 companies are actively doing business in the Indian market. Indian companies in Canada are quite active in sectors like information technology, software, steel, natural resources and banking.
Obviously, Indian companies doing business in Canada have made good investments in the economy there. Now the industry is in tension due to the increasing tension between the two countries.
According to government data, the major items exported from India to Canada include gems, jewelery and precious stones, pharmaceutical products, readymade garments, light engineering goods, iron and steel articles, which are most affected by this diplomatic tension. Whereas India imports important goods like pulses, newsprint, wood pulp, asbestos, potash, iron scrap, copper, minerals and industrial chemicals from Canada.
The total population of Indian immigrants in Canada is a little more than 4%. According to the Ministry of External Affairs, about 16 lakh people of Indian origin and 7 lakh NRIs live in Canada.