 "India and Canada quietly resetting ties amid Trumpian tariff storm")
In a world where trade has become a weapon and tariffs are viewed as a way to flex power, the quiet diplomatic reset between India and Canada offers a glimpse of resilience. Amid strained relations, the two nations named new envoys to each other’s capitals—Dinesh K Patnaik for India in Ottawa and Christopher Cooter for Canada in New Delhi. This signals a step to restore ties strained by the killing of a Sikh separatist leader in Vancouver in 2023, in which India denies any role. Both nations are reassessing their reliance on the US amid President Donald Trump’s trade war.
The announcements came amid a storm of economic pressure from Washington. President Trump imposed on India crushing 50 per cent tariffs on most US imports from India to “punish” it over its purchase of Russian oil, upending a decades-long push by the US to forge closer relations with India.
India is one of America’s most important strategic partners in Asia. He doubled down by hiking duties on select Canadian shipments to 35 per cent on August 1, aiming to staunch what he calls unfair trade flows. For India, the levies target textiles, jewellery, and auto parts—sectors employing millions. Canada, meanwhile, faces higher costs on lumber and aluminium, echoing Trump’s first-term battles that strained North American ties. This reset between India and Canada isn’t just about mending fences; it’s a strategic pivot to counter isolation and build collective leverage.
India imports around two million barrels of crude oil per day from Russia, making it the second-largest purchaser of Russian oil, according to a report. India and Russia share a robust and long-lived partnership. When Russia invaded Ukraine in 2022, Western countries imposed sanctions on Russia, which drove down the price of Russian crude. India turned to purchasing Russian oil sold at a discount.
Impact Shorts
More ShortsNew Delhi argues this stabilises prices worldwide, including for American allies, yet Trump sees it as funding Moscow’s war machine. The tariffs, effective August 27, could cost India billions, forcing refineries to scramble for pricier alternatives from West Asia or Africa. Canadian officials, too, bristle at the hikes, which exacerbate inflation in housing and manufacturing—think higher costs for building homes or cars.
Trump’s broader campaign targets trade deficits. But the moves risk backlash: Indian exporters warn of job losses in several places in India. Tariffs could pose major concerns for Canada too. These policies fragment global supply chains, pushing up costs for consumers everywhere—from iPhones assembled in India to Canadian maple syrup on US shelves.
The human toll sharpens the issue. A steep import tariff imposed by the US on Indian basmati rice has sent ripples through Punjab’s rice industry, threatening to slash exporter margins. In Ontario, auto workers ponder layoffs as tariffs bite into cross-border parts. And hovering over it all are the diplomatic tensions in the past: Canada’s accusations against India in the killing of a Sikh activist last year, which New Delhi denies, led to envoy expulsions from both sides. That rift, now thawing after a meeting between Prime Minister Narendra Modi and Mark Carney, underscores how economic duress can accelerate diplomacy.
India and Canada should deepen this alliance into a full-fledged economic pact. Start with joint ventures in clean energy—leveraging Canada’s hydroelectric expertise and India’s solar ambitions. Diversify trade partners: India could boost exports to Canada in pharmaceuticals and tech, while Ottawa ramps up investments in Indian infrastructure, creating jobs on both sides.
Multilateral forums offer another tool. As G7 and Commonwealth members, they can rally like-minded nations—Australia and Britain—to push back against US isolationism in bodies like the World Trade Organisation. Imagine coordinated appeals highlighting hypocrisy: Europe still trades billions with Russia, yet escapes Trump’s wrath. Bilateral deals could include tariff reductions on mutual goods, like Canadian lentils for Indian kitchens or Indian software for Canadian firms.
Tech collaboration holds promise too. With US restrictions looming, pooling resources in AI and semiconductors could build resilience. Imagine startups in Toronto linking with Bengaluru coders to innovate around supply disruptions. And on security, quiet intelligence sharing could address lingering distrust.
Retaliation might escalate, but dialogue could yield concessions, like exemptions for key sectors.
This envoy exchange isn’t mere symbolism—it’s a call for smarter globalism. As Trump wields tariffs like a blunt instrument, nations like India and Canada remind us that strength lies in partnerships. Leaders should prioritise talks over taxes; the alternative is a fractured world where everyone pays more for less.
The writer is a columnist. His articles have appeared in various publications like The Independent, The Globe and Mail, South China Morning Post, The Straits Times, etc. Views expressed in the above piece are personal and solely those of the author. They do not necessarily reflect Firstpost’s views.
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