India and Canada Reset Ties

The Diplomatic Reset: India and Canada Take Tentative Steps

On 20 September 2025, India's and Canada's National Security Advisors (NSAs) met for high-level talks, signaling a cautious thaw in relations after nearly two years of stagnation caused by explosive allegations over the 2023 killing of a Khalistani separatist. This meeting, accompanied by security-level discussions and the appointment of new High Commissioners on both sides, focused on extradition matters, intelligence sharing, and counter-terror cooperation. The timing is significant—and fraught—for both countries, reflecting not just diplomatic recalibration, but underlying insecurities in their bilateral equation.

What is driving this reset? At the heart of the issue lies a persistent tension: the expansive Indian diaspora in Canada, now over 1.8 million strong, has become both a bridge and a rift in bilateral ties. While India lauds these people-to-people links, Canada’s political climate, shaped by its minority-focused domestic politics, has accommodated voices sympathetic to Khalistani separatism. For India, this accommodation translates into tacit endorsement of extremism. For Canada, it’s often a matter of electoral calculus. This core contradiction haunts every bilateral engagement, making this security-focused dialogue notable for its choice of subject—and precarious for its execution.

The Policy Instrument: Security and Extradition Talks

The centerpiece of this diplomatic reset is India’s push for the extradition of Khalistani activists facing charges ranging from inciting violence to direct involvement in targeted killings. Indian agencies have long accused Canada of harboring several such individuals, including those linked to the 1985 Air India bombing, one of the deadliest terrorist acts in Indian history. Additionally, India’s Ministry of External Affairs has consistently flagged attacks on Indian diplomatic missions in cities such as Vancouver and Toronto.

On Canada’s part, the Trudeau administration appears ready to increase information-sharing mechanisms, possibly linking intelligence cooperation to broader security frameworks like the Comprehensive Economic Partnership Agreement (CEPA) negotiations. However, extradition remains fraught territory given Canada’s robust—and arguably overcautious—judicial protections for political asylum seekers. The real test lies in whether these talks will yield actionable deliverables beyond diplomatic rhetoric.

The Case for Optimism

Proponents of the reset are quick to highlight the compelling areas of overlap. Consider the economic momentum: bilateral trade hit USD 8.55 billion in 2024, with India exporting over USD 5 billion worth of goods. Negotiations on CEPA and a Foreign Investment Promotion and Protection Agreement (FIPA) reflect mutual interest in growing economic ties. Trade aside, Canada has benefited significantly from Indian students, who now make up 40% of all international students within its borders—a demographic crucial for Canada’s universities and local economies.

On multilateral platforms, India and Canada have achieved meaningful partnerships, whether through the International Solar Alliance or Arctic research collaborations under the Memorandum of Cooperation between NCPOR and POLAR Canada. Climate cooperation presents a particularly ripe opportunity, with India emerging as a major player in green energy and Canada positioning itself as a leader in clean-tech exports. Security-focused cooperation, if genuinely pursued, could also unlock credibility for both nations in counter-terrorism, creating frameworks that withstand cyclical political pressures.

The Case Against

Herein lies the irony: the very factors enabling bilateral success—economic ties, diaspora links, and shared international forums—have also fueled diplomatic friction. Canada’s selective handling of pro-Khalistan groups undermines counter-terror commitments and dents credibility. The charges of "double standards" from India are not unfounded. For example, Canada’s swift action against far lesser domestic security threats (such as ISIS-linked cells) contrasts sharply with its delayed, often procedural responses to India’s terrorism-related extradition requests.

Moreover, the gap between episodic engagement and institutional consistency remains starkly visible. The Early Progress Trade Agreement (EPTA) talks stalled in 2023 over domestic Canadian criticisms of India’s human rights record—an objection that seemed politically convenient rather than substantively informed. Bilateral intelligence cooperation too suffers from structural limitations: Canada’s intelligence apparatus often views Indian concerns through the prism of minority rights rather than transnational terror networks. This framing inhibits both trust and operational efficiency.

Comparative Insight: The UK Model

India might draw lessons from its ties with the United Kingdom, which witnessed similar Khalistani activism in the late 1980s and 1990s. After sustained diplomatic pressure, the UK tightened surveillance on extremist groups and incorporated diaspora concerns into its counter-terror strategy without compromising on democratic principles. Crucially, extradition agreements between India and the UK have seen greater progress, notably the deportation of fugitive businessman Vijay Mallya in 2020. While not flawless, the UK’s pragmatic approach to balancing rights and security contrasts sharply with Canada’s indecision.

Where Things Stand

The current moment is rife with opportunity, but equally vulnerable to derailment. India can leverage its growing geopolitical heft—the “Indo-Pacific moment”—to push for sterner Canadian commitments on terrorism. Yet much depends on how Canada recalibrates its domestic priorities, especially given it views diplomatic overtures as predominantly posturing for its internal voter base. Neither side can afford complacency, especially with trade and strategic contracts hanging delicately in the balance.

Ultimately, the risk lies less in outright hostility than in erosion by inertia. No single dialogue, however high-level, can resolve entrenched disputes without a sustained institutional framework. For now, the reset is promising—but highly fragile.

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