Canada and India have agreed to restart negotiations for a new trade deal, Indian officials confirmed on Sunday, after talks stalled following a diplomatic spat two years ago.

The announcement came after a bilateral meeting between Canadian Prime Minister Mark Carney and Indian Prime Minister Narendra Modi on the sidelines of the G20 summit in Johannesburg, South Africa.

“The leaders agreed to begin negotiations on a high-ambition Comprehensive Economic Partnership Agreement (CEPA), aimed at doubling bilateral trade to $50 billion by 2030,” said a statement from India’s Prime Minister’s Office.

On X, Prime Minister Carney added, “India is the world’s fifth-largest economy, and that means big new opportunities for Canadian workers and businesses. We launched negotiations for a trade deal that could more than double our trade to more than C$70 billion.”

Both countries also reaffirmed longstanding civil nuclear cooperation and noted ongoing discussions to expand collaboration, including through long-term uranium supply arrangements.

The restart of trade talks signals a thaw in relations after Canada paused negotiations in 2023, following accusations that India was involved in the killing of a Canadian Sikh separatist — allegations New Delhi denied. Despite the diplomatic row, trade between Canada and India continued to grow, though experts note it remains small relative to India’s economy.

In 2024, two-way goods and services trade reached about C$31 billion ($21.98 billion), largely favouring Canada due to C$16 billion in services exports. By comparison, Canada’s trade with China was nearly four times larger.

Carney emphasised the need to diversify Canada’s trade beyond the U.S., its largest trading partner, vowing to double Canada’s non-U.S. exports over the next decade.

“What we're looking to do is to put that commercial relationship on a sound footing through a potential trade agreement,” he said, noting that it would include business protections, clear rules, and dispute mechanisms.

During the summit, Carney also met with Brazilian President Luiz Inácio Lula da Silva, and the two leaders agreed to intensify negotiations on a Canada-Mercosur free trade agreement. Mercosur includes Brazil, Argentina, Paraguay, and Uruguay.

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