A developing economic connection that goes much beyond simple trade in goods might hampered by rising tensions between Canada and India over the alleged death of a Khalistani terrorist. According to Statistics Canada statistics, investments between the two countries increased significantly, reaching C$36.2 billion (2.24 lakh crore) in 2022, a 37% increase in only four years.
Vivek Dehejia, an economist and professor at Carleton University in Ottawa, reported by Bloomberg as stating, “The financial connections are very strong in both directions.” The current diplomatic consequences, in his opinion, may have a “chilling effect” on investment flows.
India is the country from which Canadian universities and colleges get the most overseas students, exerting substantial influence in the country’s educational landscape. Three significant Canadian pension funds have opened offices in Indian cities including Mumbai and New Delhi, including the Canada Pension Plan Investment Board, funds for Quebec employees, and funds for Ontario teachers. These funds collectively oversee more than C$1.2 trillion (about Rs. 74 lakh crore).
The largest pension manager in Canada, the Canada Pension Plan Investment Board, reported a $21 billion (1.74 lakh crore) investment in India approximately a year ago. A 2.7% interest in Mumbai-based Kotak Mahindra Bank Ltd. and investments in almost 70 other publicly listed Indian companies are among the company’s significant assets. The Ontario Teachers’ Pension Plan and the Caisse de Depot et Placement du Québec both have sizeable interests in India totaling more than C$3 billion and C$8 billion, respectively.
The charge against Canada
On September 18, Justin Trudeau, the prime minister of Canada, sent shockwaves across international diplomatic circles when he charged India with planning the murder of Hardeep Singh Nijjar in Vancouver in June.
Diplomats from both countries expelled as a result of India’s response, which referred to the accusations as “absurd”.
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