Prime Minister Justin Trudeau’s recent diplomatic mission to India highlighted how much trade Canada may be missing out on.
Canada recorded a trade surplus with India last year, and trade between the two countries is expanding, according to an analysis of Statistics Canada trade data. India’s GDP and purchasing power are both set to grow at a faster rate than any other emerging economy in 2018, according to the International Monetary Fund, but the Canadian government has yet to sign a free trade agreement with India.
During the Prime Minister’s trip, he helped to broker $1 billion in private deals with Canadian and Indian investors.
Canada-India Trade: 2008-2017
This graph shows trade between India and Canada between 2008 and 2017. Source: Statistics Canada, Trade Data Online
The Prime Minister failed to convince the Indian government to eliminate tariffs on pulses introduced by India late last year.
Canada’s biggest export to India is coal, but peas and lentils make up more than 20 per cent of products sold to India. Canada exported $1.1 billion worth of pulses to India in 2016; $9.3 million in 2017.
The two countries did agree to “work closely together to finalize an arrangement within 2018” on pulses, which includes peas and lentils. However, Indian import duties, including a 50 per cent tariff on peas, still threaten Canadian farmers.
On March 2, 2018, International Trade Minister François-Philippe Champagne said the government was committed to working with the Indian government to resolve the dispute.