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February 20.2026
2 Minutes Read

Canada and India Eye Trade Agreement Within a Year: What to Expect

Business executive discussing Canada India trade agreement

Canada and India: A New Chapter in Trade Relations?

In a promising turn of events for international trade, High Commissioner of India to Canada, Dinesh Kumar Patnaik, has expressed optimism that Canada and India could finalize a comprehensive trade agreement within a year. This announcement comes ahead of the much-anticipated visit of Canadian Prime Minister Mark Carney to India, signifying a potential rekindling of trade discussions that have seen multiple stalls since negotiations began in 2010.

Understanding the Stakes Behind the Agreement

According to Patnaik, the evolving global geopolitical landscape demands collaboration across various sectors, making the proposed 12-month timeline for this agreement not just realistic, but urgent. "Both the prime ministers are very keen," he said, highlighting a mutual desire for progress.

This deal, formally known as the Comprehensive Economic Partnership Agreement (CEPA), aims to cover extensive sectors including services, goods, investments, agriculture, and digital trade, which are critical to both economies. Canada and India have previously de-escalated their negotiations to sectoral agreements, reflecting the historical sensitivity of domestic markets in both nations.

The Challenges Ahead

Despite optimism, the road to a deal will not be without hurdles. Tensions surfaced in 2023 when trade talks collapsed after accusations involving the murder of a Sikh activist in Canada, which India categorically rejected. These accusations have fueled skepticism on both sides regarding trade practices, including concerns over inconsistent market access and agricultural trade barriers.

India’s protectionism, particularly concerning its local businesses, will continue to be a contentious point. Patnaik emphasizes that recent agreements on energy and climate change signal a positive shift, potentially easing some longstanding disputes that have clouded negotiations.

What Does This Mean for the Future?

The expected engagement between Canadian and Indian officials during Carney's visit in a few weeks is anticipated to set a clearer path forward for negotiations. With over 2.9 million people of Indian descent living in Canada, and over 427,000 Indian students in the country, the human capital alone presents a robust incentive for strengthening ties.

As both countries increasingly engage with each other economically and politically, the potential CEPA represents not just a trade agreement but a pivotal shift in how these nations view and interact with each other. The strategic importance of this deal could redefine their bilateral relations and create a template for future international partnerships.

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