G7 meet a big chance to mend ties with Canada but India must adjust to Khalistan reality

An invitation to Prime Minister Narendra Modi by his Canadian counterpart Mark Carney for the G7 summit in Canada later this month has sparked off speculations in both countries that this could well be the first step towards repairing the bilateral relations between the two countries that has been strained in recent years.

But Carney is hosting the G7 summit at a time when Canada’s relations with the United States, its close strategic and trade partner, is going through severe stress and the Ottawa leadership is trying to reach out to other major countries beyond Washington.

The invitation to the Indian prime minister, therefore, will have to be seen in that context.

Carney’s justification

The Canadian prime minister justified his decision to invite Modi by pointing that the G7 countries will hold important discussions on security and energy and, therefore, India’s presence at the intergovernmental political and economic forum was essential.

“India is the fifth largest economy in the world, effectively the most populous in the world, central to a number of supply chains, so it makes sense, “Carney said.

He added, “In addition, bilaterally, we have now agreed, importantly, to continued law enforcement dialogue, so there’s been some progress… I extended the invitation to Prime Minister Modi and he accepted.”

Also read: Why was Modi invited to G7 summit? Canadian PM Carney explains

Response from Modi

The Indian prime minister responded through a post on X, saying that he was glad to receive a call and invitation to the G7 summit from Carney.

Modi pointed out, “As vibrant democracies bound by deep people-to-people ties, India and Canada will work together with renewed vigour, guided by mutual respect and shared interests. Look forward to our meeting at the Summit.”

The call between the two leaders was preceded by a phone call between the Indian foreign minister S Jaishankar and his Canadian counterpart Anita Anand on May 25, when the possibility of an invitation for the summit and his participation was discussed.

An opportunity

The G7 summit, a gathering of the world’s most developed economies, as well as the leading emerging economies, comes at an uncertain time when countries have been affected by US President Donald Trump’s decision of imposing arbitrary trade tariffs on all its partners.

Much of the discussion at the gathering is likely to be focussed on this issue and how it has affected global trade.

The summit is scheduled for June 15 to June 17 in Kananaskis, Alberta.

However, the summit provides a much-needed opportunity to India and Canada to put their relations back on track.

Also read: PM Modi to attend G7 Summit in Canada, thanks Carney for invitation

Strained ties

Relations between India and Canada have been strained since September 2023 over allegations of India’s involvement in the murder of Hardeep Singh Nijjar, a Canadian-Sikh militant leader in Canada.

Carney’s predecessor, Justin Trudeau, alleged India’s involvement, while India, despite considering Nijjar to be a wanted Khalistani militant, categorically denied its involvement.

The strained ties brought all cooperation and negotiations on key agreements to a standstill, adversely affecting the strong Indian diaspora in Canada and students who were planning to study there.

Carney’s invitation, therefore, has raised hopes in a wide section of people of better days ahead between the two countries.

Raised hopes

Carney managed an unexpected victory in the general elections on an anti-Trump plank after replacing Trudeau as the Liberal Party leader early this year.

His election coincided with Donald Trump’s second term as US President and his regular anti-Canadian comments, questioning its sovereignty.

Though the Liberal Party managed to win, it still fell short of three seats for a majority in parliament.

Even though Carney is running a minority government, his victory has nevertheless opened an opportunity for close cooperation between India and Canada in a number of areas, particularly trade and investment.

Also read: NATO backs trump’s 5% defence investment demand ahead of key summit

Canada’s bilateral trade

Nearly 75 per cent of Canada’s exports go to the US. Carney faces a huge challenge as he tries to build strong ties with other countries and looks for new markets beyond America.

Canada’s relations with China have also been under severe strains in recent years, making the task harder for the new prime minister.

However, with its big market and growing middle class, India provides an attractive trade and investment destination for Carney. He is already trying to develop strong trade ties with European countries, and India will add to his options.

Indian officials feel the Free Trade Agreement between the two sides that had been put on hold following the strains in their ties can now be revived. An early implementation of the FTA will be beneficial to both countries at this juncture.

The bilateral trade between the sides is only around US$ 10 billion. But experts think this is far below the potential, and once the strains are removed from their ties, it can show significant growth in a short period of time.

India’s advantage

The invitation to Modi has come at a time when India is struggling to convince the world of Pakistan’s complicity in carrying out terrorist acts against India that was yet again manifested in the Pahalgam attack.

Canada is an important member in the western world, and getting its support in the fight against cross-border terrorism will be important for India.

Carney’s invitation allows Modi to build on the mutual strength of the two countries for a mutually cooperative relation. This can effectively put the narrative of India being involved in extra judicial killing effectively on the diplomatic backburner.

Also read: Jaishankar, Anita Anand hold 'productive' talks to reset India-Canada ties

What about Khalistan issue?

But does this mean that the Khalistan issue that had affected bilateral ties for months will now disappear?

Experts say that such a possibility seems remote. The New Democratic Party, on which the Trudeau government’s survival depended, has lost significantly in the April election. In addition, Jagmeet Singh, its leader who pushed Trudeau to take a soft stance on the Sikh extremists, has also lost his seat and resigned from the NDP leader’s post.

But 22 candidates of Punjabi origin have won in this election and 12 of them are in the ruling Liberal Party. Though this does not mean that they all support Khalistan but their sympathy for fellow Punjabi brethren can surface at critical times.

Can India adjust?

As India-Canada ties flourish under Modi and Carney’s leaderships, both countries are likely to be more sensitive to each other’s concerns.

However, allowing pro-Khalistan elements to carry out “non-violent” political activities will be par for the course in Canada’s multicultural democracy.

How the Indian leadership adjusts to this reality will remain a big question in taking forward the India-Canada relations in the coming days.