India is projected to be the world’s third largest economy by 2050 and is a priority market for Canada.
With a view to enhancing bilateral trade relations, Canada and India agreed to initiate exploratory discussions toward a Comprehensive Economic Partnership Agreement during a visit to India in January 2009 by Canada’s Minister of International Trade.
In November 2009, a Joint Study Group comprised of Canadian and Indian officials was established and tasked with examining the feasibility of such an agreement.
The Government of Canada, with the publication of a notice in the Canada Gazette on March 8, 2009, held initial public consultations to obtain the advice and views of Canadians regarding this initiative.
The Joint Study Group completed its work in June 2010. The findings outlined parameters for the negotiation of an ambitious and comprehensive trade agreement between Canada and India, and described the substantial gains to be made from eliminating trade barriers between Canada and India.
On November 12, 2010, Prime Minister Stephen Harper and Manmohan Singh announced the launch of negotiations on a Comprehensive Economic Partnership Agreement.
A Canada-India joint study estimated that an agreement could increase GDP in each country by approximately $6 billion and increase our two-way bilateral trade by 50 per cent. A free trade agreement with India stands to benefit a wide range of Canadian exports sectors such as forest products, minerals, manufactured goods, agricultural products, fish and seafood products, machinery, construction materials and equipment, aerospace, and environmental technologies.
An agreement could also benefit Canadian service providers, particularly in sectors such as energy services, mining, environmental services, engineering and financial services. Canadian life sciences and biotechnology, and information communication technologies businesses also stand to leverage their expertise in this key market and increase their exports to India.
The Joint Study findings are available on the Foreign Affairs and International Trade web site at http://www.international.gc.ca/trade-agreements-accords-commerciaux/
Canada-India Commercial Relations:
Bilateral merchandise trade with India totaled $4.2 billion in 2009, an increase of 70.2 per cent from 2004, with exports increasing by 149.3 per cent over the same period. In 2009, Canada's main export products were vegetables, fertilizers, machinery and wood pulp.
Imports from India for the same year were valued at $2.0 billion and consisted principally of organic chemicals, knit apparel, woven apparel, precious stones and metals, and electrical and electronic equipment and machinery.
According to Statistics Canada, two-way foreign direct investment between Canada and India reached record levels in 2009, standing at $3.6 billion. The stock of Indian foreign direct investment in Canada totalled nearly $3 billion. Recent major investments by Indian companies in Canada could increase this figure. The stock of Canadian foreign direct investment in India stood at $601 million in 2009.
