Canada Fitting into India's 'Scheme of Things'

Global Centre Stage

Canada is committed to promoting trade that is environmentally sound and this will be a key feature of any agreement with India. The country is well-known for its advanced technological base in agriculture, food processing, education, science and technology, innovation, environment, and cleaner technologies. From 2007 to 2012, joint funding from Canada and India supported 8 high quality bilateral R&D projects in priority areas such as Sustainable Environmental Technologies, Information and Communications Technologies and Biotechnology.

Canada is the world's most diverse country in the world. Over 20 percent of Canadian residents in 2000s were not born in the country. Statistics Canada projects that, by 2031, nearly one-half of Canadians above the age of 15 will be foreign-born or have one foreign-born parent. It is home to one of the largest Indian diaspora in the world. Indians make up 3.55 percent (1,165,145) of Canada's population, with the largest concentration of British Columbia's east Indians (6.3%).

Parliament's 'Little India'

Canada's new Liberal Prime Minister Justin Trudeau's Cabinet reflects this. Not only are half of his cabinet women, but equally historic are the four Sikhs, a Muslim Afghan woman, and a native Canadian serving as ministers. In answer to the question 'Why 50 percent women?,' Trudeau explained simply, 'It's 2015', with an insouciant shrug reminiscent of his legendary father. The same applies to the new multiethnic parliament, which includes 10 Muslims.

Trudeau's Sikh contingent represents Vancouver, Mississauga, Waterloo and Edmonton - the respective hometowns of Defence Minister Harjit Sajjan, Industry Minister Navdeep Bains, Tourism Minister Bardish Chagger, and Infrastructure Minister Amarjeet Sohi. Trudeau's cabinet now contains more Sikh cabinet ministers than that of India.

There are precedents. Sikh MP Herb Dhaliwal was elected in 1993 as a Liberal MP and was appointed minister of revenue by the Liberal Prime Minister Jean Chretien in 1997. In 1999, he became minister of fisheries and oceans, and in 2002 he was appointed minister of natural resources and minister with political responsibility for British Columbia. The next Indian cabinet minister was Liberal cabinet minister Ujjal Dosanjh, who served as minister of health under Liberal Prime Minister Paul Martin from 2004 until 2006. He was defence critic for the Liberals during the Harper Conservative government.

This is a very positive development as the Sikh independence movement cast a pall on Canadian Indians from the 1980s on, after the assassination of Indian Prime Minister Indira Gandhi and the bombing of Air India Flight 182 from Montreal to New Delhi in 1985. Now Canadians can see prominent Sikhs serving Canada in the hallowed halls of parliament, and can turn a new page.

What could be more appropriate ministry for a Sikh than defence, given Sikh traditions of serving in the Indian Army and in WWI? Harjit Singh Sajjan, a decorated combat veteran who was born in Punjab, and migrated to Canada when he was a child, was in the Canadian army in Bosnia-Herzegovina and Afghanistan, where he received a Canadian meritorious service medal in 2013 for reducing the Taliban's influence in Kandahar province. He also patented a gas mask that covers beards.

Navdeep Singh-Bains, 38, born in Toronto to immigrant parents is the new minister of innovation, science and economic development. A former financial analyst and visiting professor at Ryerson University in Toronto, Mr. Bains was a member of parliament from 2004 to 2011 representing Mississauga and Brampton, two suburbs of Toronto that boast a significant South Asian population.

Amarjeet Sohi, the Minister of Infrastructure and Communities, was born in Punjab, India and migrated to the city of Calgary in 1981. Mr. Sohi was appointed to the Edmonton city council three times from 2007 to 2015, and will be responsible for the government's key spending on transit and infrastructure.

Bardish Chagger, Minister of Small Business and Tourism, was born to immigrant parents who migrated to Canada in the 1970s from India. Ms. Chagger, a rookie member of parliament was introduced to Canadian politics by her Indian father, who was a long time Liberal party supporter.

The new federal ministers, and other Sikh politicians such as Bramalea-Gore-Malton MPP Jagmeet Singh, the deputy leader of Ontario's NDP, are the children of the first wave of Sikh immigrants who left India in the 1970s and 1980s. Nadir Patel, Canada's High Commissioner to India since 2014, also immigrated with his family at that time.

Official Visit has Strong Roots

Though an official visit by Canada's new prime minister has not been set, both sides are eager to engage, and Trudeau will no doubt be accompanied by some of his Indian-born ministers, building a new platform for cooperation, based on the strong relations in the past.

In the 1940s and 1960s, Canada–India relations were enhanced because of the personal ties that developed between Indian Prime Minister Jawaharlal Nehru and two Canadian prime ministers who served during those years - Louis St. Laurent and Lester B. Pearson. At the United Nations and in the Commonwealth, on issues as diverse as the Korean War Armistice and the Suez Crisis, there was a convergence of interest and commitment between India and Canada.

Canada's aid programme to India began in 1951 and grew substantially under the Colombo Plan. Canada provided food aid, project financing and technical assistance to India. In the past 5 decades, India has been one of the largest recipients of Canadian bilateral aid, amounting to over $3.8 billion Canadian dollars. In the 1960s, Canada supported the Kundah hydro-electric power house project through Colombo Plan.

Indo-Canadian relations deteriorated in the wake of India's Smiling Buddha nuclear test of May 1974 when the Canadian government severed bilateral nuclear cooperation with both India and Pakistan in 1976. However, disagreements on nuclear weapons could not stand in the way of pressing issues of terrorism. Following the bombing of Air India Flight 182 in 1985, Canada and India maintain a bilateral dialogue on anti-terrorism, including an annual meeting of the Canada-India Strategic Dialogue, as well as regular meetings of the Canada-India Working Group on Counter-Terrorism.

In the 1990s, a chance to improve Indo-Canadian relations arose when India instituted major reforms of its economy. India went through a large economic liberalisation, which attracted the attention of the Canadian government and the business community. The then Canadian Prime Minister Jean Chrétien headed a diplomatic mission to India in January 1996 with two cabinet ministers and 300 business figures.

The Canada India Foundation has been active since 2007 in fostering support for stronger bilateral relations between the two countries. Indian Prime Minister Manmohan Singh visited Canada in June 2010 for the G20 Summit in Toronto. 2011 was dubbed the 'Year of India in Canada,' a joint initiative by both governments. Under this auspice, in June 2011, the Indo-Canada Chamber of Commerce co-hosted with the government of India the regional Pravasi Bhartiya Divas, a conference of the diaspora. This conference hosted over 1,000 delegates from India and Canada's governmental, business, medical, scientific, and philanthropic sectors. This event was followed by the International Indian Film Academy Awards held in Toronto in June 2011.

The then Conservative Prime Minister Stephen Harper made a state visit in 2012. Prime Minister Narendra Modi held a privileged private audience with Ontario Premier Kathleen Wynne and Prince Edward Island Premier Wade MacLauchlan - like Trudeau, both Liberal leaders - in January 2016, and urged them to get Trudeau to visit India as soon as possible to boost trade.

Good Trade Prospects

Canada's development assistance to India has fallen in recent years because of neoliberal economic reforms, cutting all foreign aid and following a change in Indian government policy regarding aid in 2006, during which Canada's bilateral development assistance program came to an end. However, Foreign Affairs, Trade and Development Canada (DFATD) continues to provide assistance to India through partnerships between Indian and Canadian NGOs and multilateral programs.

In addition, the Canadian High Commission in New Delhi manages the Canada Fund for Local Initiatives (CFLI), to support local projects in India focusing on gender equality, human rights, and good governance. The CFLI is a program that supports small projects proposed and implemented by local NGOs and other grassroot organisations such as village councils, cooperatives and women's groups.

The nuclear issue has quietened down. In December 2015, the first shipment of uranium from Sasketchewan-based Cameco arrived in India. Part of a $350 million, 5-year contract signed during Prime Minister Narendra Modi's visit to Canada in April 2015, came with strong symbolic resonance of a relationship that has new energy and could gather more momentum in 2016 with a visit to India by Trudeau.

Trade relations are robust. Since 2004, trade has increased by over 70 percent. Two-way trade has increased from 4.2 billion Canadian dollars in 2010 to 6.4 billion Canadian dollars in 2014.

Agreements, MoUs - Arbitration Roadblock

In 2010, Canada and India began negotiations toward a Comprehensive Economic Partnership Agreement (CEPA). The 9th round of negotiations was held in March 2015 in New Delhi, which was focused on goods and services. Canada remains committed to concluding an ambitious agreement, though Canadian officials froze the ongoing talks until both sides sign a Foreign Investment Promotion and Protection Agreement (FIPA).

FIPA negotiations technically concluded in 2007, but the deal was never signed. Indian government put the brakes on any foreign investment agreements that included investor-state arbitration mechanisms in 2013. India put investment treaties with Canada and 83 other countries on hold in 2013 because of clauses that gave rights to investors to sue the state in a commercial dispute.

Canada government listed negotiations on the India FIPA as 'concluded' as recently as October 16, 2015, a few days before the federal election that ousted the Conservatives and put the Liberals in power, according to Global Affairs Canada, but the same page now lists the talks as 'ongoing'. “Canada and India have agreed to begin negotiations towards a Foreign Investment Promotion and Protection Agreement. The parties have pledged to work together to finalise the agreement on a priority basis.”

In January 2016, Indian government released its 'Model BIT', the product of a review of its process for negotiating bilateral investment treaties. The 'Model BIT' requires investors to pursue disputes in domestic courts for at least 5 years before moving on to international arbitration. Hopefully, the hold-up in negotiations for both FIPA and CEPA will now be smoothed over with this new compromise.

Concerning investor-state arbitration, Indian High Commissioner to Canada Vishnu Prakash said that 'legal remedies' are an important part of any FIPA negotiation and are 'matters of detail that can be sorted out.' The leaders of the two countries 'welcomed the progress made in the recent bilateral discussions between treaty negotiators (on the FIPA) and agreed to intensify discussions to finalise the outstanding issues' in a joint statement issued during the visit of Indian Prime Minister Narendra Modi's to Ottawa in April 2015.

The Indian FIPA isn't Canada's only international treaty to have been stalled by investor-state arbitration. Canada's Comprehensive Economic and Trade Agreement with the European Union (EU) has been bogged down for months as opponents of investor-state arbitration - also known as Investor-State Dispute Settlement, or ISDS - protested the deal. Canada's new Liberal government has hinted it may be willing to revisit those provisions in the CETA, in contrast to the hardline taken by the former Conservative government.

“We know that ISDS is an issue. We have, I think, a pretty reasonable approach, an open-minded approach to ISDS. So I think it's fair to say we like the agreement as it is, but we'll continue to engage our European partners and we'll get this deal to work,” Canadian Parliamentary Secretary for Trade David Lametti told Embassy in January.

Environment, Foreign Workers

Canada is committed to promoting trade that is environmentally sound and this will be a key feature of any agreement with India. The country is well-known for its advanced technological base in agriculture, food processing, education, science and technology, innovation, environment, and cleaner technologies. From 2007 to 2012, joint funding from Canada and India supported 8 high quality bilateral R&D projects in priority areas such as Sustainable Environmental Technologies, Information and Communications Technologies (ICT) and Biotechnology.

The two countries have established the Canada-India Forum for Environmental Collaboration in order to increase technology and knowledge exchange on environmental issues. Canada and India also initiated a Canada India Energy Forum in 2009.

India also wants to discuss Canada's temporary foreign worker laws, as it seeks to help more of its skilled IT workers to win jobs abroad.

The interests are different between the countries but the problems are not insurmountable. Indian High Commissioner to Canada Vishnu Prakash said India is eager to complete trade and investment deals with Canada as soon as possible. He rejected the idea that an investment agreement must be signed before a trade agreement. India is interested in access to a range of Canadian goods and services, including Liquefied Natural Gas (LNG).

When Trudeau visits India - hopefully this year - his visit should crown the finalisation of CEPA and the FIPA. The new Canadian government may need a little time to pull together a strategy for engaging India on free trade and investment agreements, but doing so is essential for Canada, said Gary Comerford, President and CEO of the Canada India Business Council.

Go to Content Page

Back to Top

Diplomatist Magazine was launched in October of 1996 as the signature magazine of L.B. Associates (Pvt) Ltd, a contract publishing house based in Noida, a satellite town of New Delhi, India, the National Capital.