India and Canada are getting closer to signing an early-stage trade agreement, a move that’s part of a larger Canadian strategy to diversify its Pacific trade and supply chains away from China.
Indian Commerce and Industry Minister Piyush Goyal is in Ottawa on Monday for ministerial talks and the two countries are making steady progress toward a deal, Canadian Trade Minister Mary Ng said in an interview with Bloomberg News.
Canada has had intermittent trade negotiations with India going back more than a decade, but last year the two sides decided to narrow the scope and focus on an initial deal that would include a few industries, rather than an economy-wide accord.
Ng said she has a strong relationship with Goyal and that they are advancing toward a signed agreement. “It is not going to be years,” she said about how much longer it will take. The point of doing an early-stage trade deal is to be practical and spend time on areas of agreement rather than having talks drag out, she said.
Ng didn’t lay out the industries that would be included in any such deal, but she said technology — especially for lowering emissions and protecting the environment — would naturally be a focus.
“There will be rules around investment, rules around tariff reductions, rules around the kinds of services that we would do with each other, rules around how to facilitate trade,” she said.
Providing a more predictable investment regime for Canadians is also a priority, Ng said. Canadian pension funds are increasingly investing in Indian infrastructure and Canadians overall have about $65 billion in portfolio investments in India, she said.
A trade deal with India is also part of the government’s larger Indo-Pacific strategy to diversify its trade away from heavy dependence on China, Ng said. “This very much is about building trade ties and resiliency with those who advance and respect the rule of law,” she said.
Indian Prime Minister Narendra Modi is chairing the Group of 20 this year, meaning Canadian ministers will be visiting India throughout the year — with Prime Minister Justin Trudeau likely to attend the leaders’ summit in New Delhi in September.
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