Increasing tension between India and Canada is unlikely to affect trade and investment
16-Oct-2024 03:48 PM
New Delhi. Although the tension and distance between India and Canada is increasing continuously and the rounds of allegations and counter-allegations are also continuing, but experts say that the increasing dispute and tension at the diplomatic level will not have any significant effect on trade and investment because it can cause huge losses to both the parties.
But it seems that the trade agreement which was about to be signed between the two countries and for which talks were going on, it is difficult to make further progress till Justin Trudeau remains the Prime Minister of Canada.
The Canadian government is accusing India that Indian agents are involved in the murder of its citizen. For this, it has got the data of an intelligence organization called Five Eye.
It includes organizations of America, Britain, Canada, Australia and New Zealand. But India has called its allegations baseless.
The High Commissioners (Ambassadors) and other senior diplomats of both the countries are returning to their respective countries, due to which there is a possibility of mutual deadlock increasing, but along with this it is also being kept in mind that this deadlock should not affect the bilateral trade.
According to senior official sources, this matter has not yet reached a worrying level. Anyway, bilateral trade is not so huge that it can affect India's gross trade much. Canada is also concerned about the interests of its farmers.
The maximum export of lentils and peas from Canada is to India and if its shipment stops, its producers and exporters may face great difficulty. India will also face some trouble, but for this there are options like Australia and Russia.
Canada's pension funds will continue to invest in India even if it has to maintain it through countries like Singapore or United Arab Emirates. Canada's share in India's total foreign trade is less than 1 percent. Canada is India's 33rd largest trading partner.
In the first seven months of the current financial year i.e. April-October 2024, trade between the two countries was worth $2.68 lakh,
but if the deadlock increases, then the import of yellow peas and lentils from Canada to India may be partially affected in the coming months.