Experts say Canada's already lagging trade with India could suffer setbacks including the potential for punitive measures from increasingly tense relations between the two countries.
Prime Minister Justin Trudeau revealed on Monday that Canada has "credible" information about a potential link between India's government and the death of British Columbia Sikh leader Hardeep Singh Nijjar, an assertion that New Delhi blasted as "absurd and motivated."
The serious allegations prompted both countries to expel one of the other's diplomats, while talks on a trade deal and a planned Canadian trade mission have been put on hold.
Asia Pacific Foundation of Canada president Jeff Nankivell says that besides derailing efforts to boost trade, a key concern will be India's response, including whether it imposes import measures that could especially affect Canadian agricultural exports to the country.
He says the developments are concerning but that for now the Canadian government has limited options as the allegations and continuing investigation will likely lead to increasingly strained relations.
John Boscariol, head of the international trade and investment law group at McCarthy Tétrault LLP, says the latest developments must be concerning for the Canadian business community, both for the potential effect on growth and how India might react.
This report by The Canadian Press was first published Sept. 19, 2023.
The Canadian Press