Canada trading with the world as it is

In what many will regard as the triumph of economic necessity over principle, Canada and India have agreed to a major reset of the two nations’ relations.

Following meetings over the weekend between Prime Minister Mark Carney and Indian Prime Minister Narendra Modi, the two have announced the formation of a “new partnership,” along with a series of commercial and diplomatic agreements.

That includes a $2.6-billion agreement between the Government of India and Saskatchewan-based Cameco to supply uranium for nuclear energy generation, as well as billions more in deals involving defence, energy and critical minerals, technology and artificial intelligence, food production, education, pharmaceuticals, skilled labour and culture.

The deals are proof that Canada is serious about diversifying its international trading relationships and, in particular, reducing its reliance on trade with the United States. On that point, Carney told reporters yesterday that his government is focused on doubling Canada’s trade with India to $70 billion annually by 2030.

Standing beside Modi, the PM said that “This is not merely the renewal of a relationship. It is the expansion of a valued partnership with new ambition, focus and foresight — a partnership between two confident countries charting our course for the future.”

He explained that the core of that expanded relationship will be a free-trade agreement, described as a “comprehensive economic partnership agreement,” that the two nations hope to enter into by the end of this year.

This weekend’s flurry of agreements and announcements appear to represent a stark and sudden shift in Canada-India relations, which reached a low point when the Trudeau government accused the Indian government of being involved in the murder of a Canadian citizen in Canada, and of interfering in Canada’s political processes. That, in turn, triggered diplomatic retaliation by India.

Whether those tensions have been resolved, or are simply subordinate to the economic priorities of the two nations, is an open question.

Last week, a senior Canadian government official told the media that India was no longer actively involved in foreign interference or transnational regression. Those words were contradicted by Foreign Affairs Minister Anita Anand, however, who said yesterday that “The words of the senior official are not words that I personally would use. I agree with his comments relating to the guardrails that we have in place.”

Secretary of State (Combatting Crime) Ruby Sahota, a Liberal MP, has gone further, saying in a press release that “While Canada continues to pursue constructive engagement with India, serious security concerns remain,” she said. “Any suggestion these threats have been resolved does not reflect the current security reality facing Canada.”

Those remarks underscore the anxiety that many Canadians share regarding the apparent blossoming relationship between Canada and India — concerns similar to those raised earlier this year, when Carney announced improved trade relations with China. In both cases, our government appears to be placing a higher priority on economic growth, stability and independence than moral and legal principle.

That is a valid perspective but, given the perilous economic situation Canada finds itself in — under the constant threat of significant economic harm caused by erratic and punitive shifts in U.S. trade policies — we cannot afford to turn our back on the world’s second-largest economy (China) and the world’s fastest-growing economy (India). We cannot afford to ignore a combined market of more than two billion consumers.

That was the point Carney made in his speech at the World Economic Forum in January, when he said that Canada’s approach to international trade requires us to navigate the “world as it is, not as we wish it to be.” He emphasized that, in a volatile world of imperfect choices, we must balance our defence of democratic values with a commitment to Canada’s economic stability.

Some Canadians see that compromise as the abandonment of important democratic and/or moral values, but others regard it as simply reflecting the economic realities of the times we are living in.

Canada does not have the luxury of only engaging in trade relationships with nations that meet the highest democratic and moral standards of conduct. We must take the world as we find it, while continuing to take steps — and having the “guardrails” — to protect our nation from harm.