Canadian PM Justin Trudeau pitches for closer economic ties with India

Canadian Prime Minister Justin Trudeau on Thursday stressed the need for greater economic ties with India, arguing that the large size of the two countries and India's huge diaspora in Canada provided an opportunity to do so.

He said his current trip to India generated investments of more than 1 billion Canadian dollars. 

Ostensibly reacting to criticisms about his more than a week-long trip to India at the taxpayer’s expense, Trudeau said 6,000 jobs would be created as a result of this in Canada. This was on account of investments by information technology giants such as Tech Mahindra, Infosys, and Tata Consultancy Services. 
 

While it was not clear how much investment had come to India, senior government officials said all details might be available on Friday, when Trudeau meets Prime Minister Narendra Modi.

Trudeau said ties needed to shift from a “whole of country approach” to a “whole of government” approach. 
 

Canada has more than 1.3 million citizens of Indian origin and the business delegation had a significant number of such people, a senior functionary of the Indo-Canadian Business Chamber said. 

Four Canadian ministers of Indian origin participated in a business meet on Thursday.

There are more than 400 Canadian firms with a presence in India, such as train manufacturer Bombardier, insurance major Sunlife, and Canadian pension funds, which are looking to expand in India.

Despite Canada’s southern neighbour, the US, being India’s largest export destination, bilateral trade with Canada has remained low. Two-way trade was $6.1 billion in 2016-17, down 2 per cent from the previous year.

India and Canada are negotiating the Foreign Investment Promotion and Protection Agreement (FIPPA) and the Comprehensive Economic Partnership Agreement (CEPA). 

Talks on the FIPPA had been stalled by New Delhi's decision to conduct negotiations on all investment pacts under the framework of the model Bilateral Investment Treaty, issued by the government in 2015.

“Canada’s prime concern is with the clause that in the case of an investor-state dispute, a foreign investor can seek international arbitration only when all domestic legal options are exhausted. While India feels this is required to keep control on litigation and reduce the chances of extremely high penalties from international tribunals, most developed nations believe the Indian legal system to be slow and corrupt,” a senior government official said.
 

On the trade front, more than a quarter of all imports are on account of pulses, including yellow peas, green peas and red lentil, amounting to $1.1 billion. Exports from India are broadbased, with no commodity constituting more than 8 per cent of the outbound trade. Medicines, shrimps and prawns, and jewellery are the major exports.

Trudeau also stressed the importance of inclusive trade.