INDIA AND CANADA RELATIONSHIP – INTERNATIONAL RELATIONS
News: Canada launches Indo-Pacific strategy, terms China ‘increasingly disruptive’, and India a ‘crucial partner’
What's in the news?
● Recognizing that the Indo-Pacific region will play a “significant and profound” role in its future, Canada released an Indo-Pacific strategy which termed China an “increasingly disruptive” global power.
● Calling India a “crucial partner”, the strategy said Canada will seek new opportunities to partner and engage in dialogue with India in areas of common interest and values, including security, and the promotion of democracy, pluralism and human rights.
Key takeaways:
● Based on five inter-connected strategic objectives, it announced an ambitious plan, beginning with an investment of almost $2.3 billion over the next five years.
● Canada is the latest among several Western countries which have recently outlined Indo-Pacific strategy.
Objectives of Canada's Indo-Pacific Strategy:
The five objectives are as follows.
● Promoting peace
● Resilience, and security
● Expanding trade, investment, and supply-chain resilience
● Investing in and connecting people
● Building a sustainable and green future and Canada as an active and engaged partner in the Indo-Pacific.
Canada's Indo-Pacific Strategy:
1. Assertive China:
● The strategy reads that, “China is looking to shape the international order into a more permissive environment for interests and values that increasingly depart from ours."
● The strategy also said that, “In areas of profound disagreement, we will challenge China, including when it engages in coercive behaviour - economic or otherwise - ignores human rights obligations or undermines our national security interests and those of partners in the region.”
2. Canada - a reliable partner in Indo-Pacific:
● As China becomes more assertive and grows in influence, Canada is stepping up as a reliable partner in the region to promote security and stability across the region and at home.
● Canada will increase military engagement and intelligence capacity as a means of mitigating coercive behavior and threats to regional security.
3. India - crucial partner for Canada:
● India’s growing strategic, economic and demographic importance in the Indo-Pacific makes it a critical partner in Canada’s pursuit of its objectives under this strategy.
4. Security interest:
● To advance Canada’s regional peace and security interests, it plans to invest over $720 million which includes $492.9 million to reinforce Canada’s Indo-Pacific naval presence and increase its military’s participation in regional military exercises as well as $47.3 million to launch a new multi-department initiative to help develop cyber security capacity in select regional partners.
5. People-to-people ties:
● To forge stronger people-to-people ties with the Indo-Pacific, Canada will contribute $261.7 million which includes $100 million in the Feminist International Assistance Policy development funding to support the Indo-Pacific.
● Also, there will be $74.6 million to enhance Canada’s visa processing capacity within its centralized network as well as in New Delhi, Chandigarh, Islamabad, and Manila.
6. Sustainable development:
● Canada also committed $913.3 mn for a clean future, of which $750 million is to support sustainable infrastructure and $84.3 million to reinforce a healthy marine environment in the Indo-Pacific region, including enhanced measures against illegal, unreported and unregulated (IUU) fishing.
Under the strategy, Canada also committed $143.3 million to strengthen its presence, visibility and influence in the region.
India - Canada Relations:
Backdrop:
● Canada and India have longstanding bilateral relations built upon shared traditions of democracy, pluralism and strong interpersonal connections.
● This is complemented by economic engagement, regular high-level interactions and long-standing people-to-people ties.
● Canada is home to one of the largest South Asian communities abroad, with approximately 5.6% of Canadians being of Indian heritage (1.9 million people).
1. Trade Relations:
● A priority market for Canada, in 2021, India was Canada’s 14th largest export market, and 13th largest trading partner overall.
● India will be a key partner as Canada strengthens its economic links to the Indo-Pacific under a new, comprehensive strategy for the region.
● Indian exports include gems, jewelry and precious stones, pharmaceutical products, readymade garments, light engineering goods, iron & steel articles, etc.
● India’s imports from Canada include pulses, newsprint, wood pulp, asbestos, potash, iron scrap, copper, minerals and industrial chemicals, etc.
● Indian companies have invested especially in the IT, software, steel and natural resources sectors
● Canada’s commercial priorities in India are targeted at India’s policy objectives and sectors where Canada has a comparative advantage. These priorities include:
○ Supporting India’s energy security ambitions through increased exports of conventional and nuclear energy as well as clean and renewable energy technology.
○ Helping India meet its substantial urban and transportation infrastructure needs through provision of financing, equipment, technology and engineering services.
○ Enhanced education and skills training through greater collaboration between Canadian and Indian educational and technical skills institutions.
○ Commercial research and development to drive innovation in such sectors as information and communications technologies.
○ Increased exports of food products and fertilizers to support India’s food security needs.
○ Focusing on opportunities for Canadian partnerships as suppliers in the Life Sciences sector to support India’s industry-leading presence in the pharmaceutical sector;
○ Integrating Canadian companies into India’s automotive supply chains
● Canada and India are working toward a Comprehensive Economic Partnership Agreement (CEPA) and a Foreign Investment Promotion and Protection Agreement (FIPA).
● Canada views concluding an Early Progress Trade Agreement [EPTA] as a step toward a Comprehensive Economic Partnership Agreement in expanding market access.
● Canada and India hold Ministerial Dialogues on trade and investment.
2. Cooperation in Energy sectors:
● India and Canada signed a Nuclear Cooperation Agreement (NCA) in 2010 for which a Joint Committee on Civil Nuclear Cooperation was constituted by both the countries.
● In 2015, when the Indian PM visited Canada, a Uranium supply deal was signed.
● Energy cooperation agreements were signed in 2018, when the Canadian Prime Minister visited India.
3. Space Cooperation:
● ISRO and CSA (Canadian Space Agency) have signed MOUs for cooperation in the field of exploration and utilization of outer space and two Implementation Arrangements specifically addressing satellite tracking and space astronomy have also been signed.
● ANTRIX, the Commercial arm of ISRO has launched many Canadian Satellites.
4. Education Sector:
● In 2018, India was the largest source of international students for Canada’s universities, colleges and schools.
● IC-IMPACTS (the India-Canada Centre for Innovative Multidisciplinary Partnerships to Accelerate Community Transformation and Sustainability) is a research center dedicated to the development of research collaborations between Canada and India.
5. People-to-people connections:
● On people-to-people connect, the strategy said it would invest in and connect people, including by “bolstering Canada’s visa-processing capacity in New Delhi and Chandigarh” as also support academic, educational, cultural, youth and research exchanges.
● Indian Diaspora:
○ The Diaspora is well represented in federal Parliament and provincial legislatures.
○ For example, The New Democratic Party, one of the coalition party of the present Canadian government, is headed by a person of Indian Origin (Jagmeet Singh).
6. Cooperation in Security and Defence;
● India and Canada collaborate closely in international fora, particularly through the United Nations (UN), Commonwealth and G-20. Defence ties have been expanding with mutual ship visits.
● There is robust cooperation on counter terrorism issues particularly through the framework of the Joint Working Group (JWG) on Counter Terrorism.
7. Institutional Partnership:
● Both the countries also formed various organizations such as Canada - India Parliamentary Friendship Group (CIPEG), Canada India Business Council (CIBC), Canada India Foundation (CIF), Indo-Canada Chamber of Commerce (I-CCC) for strengthening India-Canada Cooperation.
● Various MOU’s between India and Canada has been signed in sectors such as
○ Agriculture
○ Civil Aviation and Railways
○ Double taxation etc.
CHALLENGES AHEAD:
Though India and Canada have long standing relationships, the co-operation never achieved its full potential because of various reasons.
1. Khalistani separatist factor:
● It is the single most important challenge between India and Canada ties.
● Sikhs constitute a significant proportion of the Indian diaspora; they make up little less than one percent (a little over 500,000) of Canada’s total population and few leaders in Canada support Khalistan movement to large extent for electoral gains in Canada.
● The Ontario Provincial Parliament adopted a resolution terming the 1984 anti-Sikh riots as ‘genocide’ and many other Canadian leaders also support that even today.
● During the recent Canadian PM visit to India, a controversial picture where former Sikh separatist Jaspal Atwal has surfaced in the news.
● The Canadian government usually tries to balance the Sikh assertions and the government's India policy. This makes India Canada relationship at stake.
● It is also the reason for the recent Canadian PM’s support for the Indian farmer’s protest.
2. Trade Relations:
● Though both the countries are involved in Trade for a long time the trade deals “always underperformed” said by the Ministry of External Affairs, India.
● Feminisation of Canadian Trade Policies:
○ The Canadian Government put in gender clauses in the trade pact. Though it is revolutionary, in countries like India it was seen as a non-tariff barrier.
○ For Example, The Canadian Trade agreement with Chile has the entire Chapter devoted to women.
3. Bilateral agreements:
● Comprehensive Economic Partnership Agreement (CEPA) and Investment Promotion and Protection Agreements (BIPPA), have been in negotiation for a long time and no progress is reached by both the countries.
4. Strategic Location:
● Canada surrounded by developed Western countries does not clearly understand India located with hostile neighbors like China and Pakistan.
● The terms and conditions have heavily tilted towards developed countries and Indian interests are not considered seriously so far.
WAY FORWARD:
● Canada has to understand and remove Feminization clause in trade pacts or give more time to countries like India to complete the terms associated.
● Canada is one of the most advanced countries in terms of renewable energy. India with its focus on renewable energy targets in Nationally Determined Contributions has to strike a deal or MOU regarding renewable energy.
● Infrastructure and transport sectors are potential areas of cooperation and investment. India’s ambitious ‘smart cities’ initiative creates opportunities for Canadian firms like Bombardier, etc.
● In 2017, the Canadian government announced that Canada will take in 1 Million more Immigrants. With the US and few other Western Countries turning down migrants, Canada turned as an alternative destination for Indians and India has to leverage that.
● Canadian Energy reserves: According to the World Oil Outlook Report, India’s oil demand will double by 2040. Canada’s Oil and Liquefied Natural Gas (LNG) resources offer a better alternative towards Indian demands.
● Convergence over China factor: Canada recently started to diverge its trade relations and opposed China’s diplomacy. India has a potential to become a trade supplier.
There is enough potential for both India and Canada to boost the cooperation and take their relations to the next level. But it requires Canadian effort by widening their Indian perspective. This can happen if India by diverting the talks from politically contentious issues.