Prime Minister Narendra Modi and Canadian Prime Minister Mark Carney held their first formal bilateral meeting after relations between the two countries soured in 2023. They met during the G7 Summit held in Kananaskis, Alberta. This summit also marked Modi’s first official visit to Canada in ten years. The meeting came after nearly two years of frozen diplomatic engagement due to a major controversy.
The Diplomatic Breakdown in 2023
Tensions began in September 2023 when then-Canadian Prime Minister Justin Trudeau accused Indian authorities of being involved in the murder of Hardeep Singh Nijjar, a Canadian Sikh separatist. Nijjar led the banned Khalistan Tiger Force and was labeled a terrorist by India. India firmly rejected Trudeau’s accusation, calling it “absurd,” and blamed Canada for allowing anti-India elements to operate freely. The fallout was severe. Both countries expelled several diplomats. They also halted trade negotiations and senior-level talks, pushing their relationship to a historic low.
A Warmer Tone in 2025
In contrast, Modi’s visit in 2025 received a warm welcome. Mark Carney said, “It’s my great honour to have you here.” Both leaders described their meeting as “excellent” and “positive,” suggesting a new willingness to rebuild ties. Foreign Secretary Vikram Misri confirmed that the discussion was “very positive and constructive.” He explained that the leaders focused on shared democratic values, people-to-people links, and economic cooperation. Misri added, “The Prime Ministers agreed to take calibrated steps to restore stability to this very important relationship.”
Steps Toward Normalization
One of the first steps agreed upon was appointing new High Commissioners in each other’s capitals. This move marked a major symbolic reset, as both nations had withdrawn their top diplomats during the dispute. The leaders also decided to restart high-level dialogue on key areas such as trade, education, infrastructure, and migration. Both sides instructed their officials to resume trade negotiations that had been on hold since 2023. According to the Canadian Prime Minister’s Office, the two leaders “reaffirmed the importance of Canada-India ties, based upon mutual respect, the rule of law, and a commitment to the principle of sovereignty and territorial integrity.” They also agreed to return to regular consular services for citizens and businesses.
Past Accusations and Investigations
The shift in tone followed a long period of friction. After Trudeau’s claims, Canada expelled six Indian diplomats. India responded by withdrawing its acting High Commissioner and five officials. In October 2024, Canadian authorities further accused India’s High Commissioner Sanjay Kumar Verma and his team of being involved in the murder. When Canada requested diplomatic immunity to be waived, India refused and pulled out its entire diplomatic staff. On October 14, 2024, the Royal Canadian Mounted Police publicly accused Indian agents of orchestrating operations in Canada. However, a Canadian commission report in January 2025 found “no definitive link” to any foreign state.
Protests and Political Sensitivity
Despite this reconciliation, Modi’s visit to Canada drew protests. A few dozen demonstrators, including pro-Khalistan supporters, gathered in Calgary. They tore Indian flags and protested Modi’s presence. Still, Prime Minister Carney defended his decision to invite Modi. He emphasized India’s role in solving global challenges. “India has been coming to the G7 since 2019 and it’s a testament to the importance of your country, to your leadership, and to the importance that we look to tackle together,” Carney said during their meeting.
A Strong Trade and Investment Relationship
India and Canada maintain strong economic ties. In 2023, India exported goods worth USD 7.53 billion to Canada. Canadian exports to India totaled CAD 5.12 billion. The total merchandise trade for that year reached CAD 12.65 billion. From January to August 2024, goods trade reached CAD 8.55 billion, with India exporting CAD 5.22 billion. Trade in services was also significant. In 2023, bilateral services trade reached CAD 13.49 billion. During the first half of 2024, the figure stood at CAD 7.85 billion. Canadian pension funds have invested more than CAD 75 billion in India, showing strong financial trust. Over 600 Canadian companies operate in India, while over 1,000 more are exploring business there. Indian companies in Canada are active in IT, banking, natural resources, healthcare, and financial services.
Key Imports and Export
India’s major exports to Canada include pharmaceuticals, electronics, jewelry, engineering goods, seafood, and auto parts. In return, India imports Canadian products such as potash, pulses, aluminum, iron scrap, newsprint, industrial chemicals, and gemstones. The two leaders also explored cooperation in clean energy, artificial intelligence, digital infrastructure, food security, fertilizers, and critical minerals.
A Deep Connection Through Diaspora
Canada is home to nearly 1.8 million people of Indian origin and about 1 million non-resident Indians. Together, they make up more than 3% of the Canadian population. Additionally, over 427,000 Indian students are currently enrolled in Canadian institutions, making India the largest source of international students. This large Indian diaspora has always acted as a cultural and emotional bridge between the two nations.
India’s Concerns Over Extremism
Despite improving ties, India remains concerned about extremist activities in Canada. It has asked Ottawa to take action on long-pending extradition requests. These include names like Lakhbir Singh Landa, Gurjinder Singh, Gurpreet Singh, Gurjeet Singh, and Arshdeep Singh Gill — individuals facing terror-related charges. Modi’s meeting with Carney is expected to reopen these discussions. However, due to political sensitivities, progress on this front may remain slow.