Canada pushes trade reset with Indo-Pacific states amid US tariff threats

Canadian Prime Minister Mark Carney will travel to India, Australia and Japan (Indo Pacific) starting February 26 as part of a major diplomatic effort to diversify Canada’s trade and strengthen partnerships in defence, clean energy and artificial intelligence.

Carney will begin his visit in Mumbai before travelling to New Delhi for talks with Indian Prime Minister Narendra Modi . According to a statement from the Prime Minister’s Office, the leaders will focus on expanding the Canada-India relationship through new partnerships in trade, energy, technology, artificial intelligence, talent exchange, culture and defence, while also seeking to formally launch negotiations for a Comprehensive Economic Partnership Agreement (CEPA) aimed at deepening economic integration. Carney will also meet Indian business leaders to identify investment opportunities and promote closer commercial ties between companies in both countries.

India was Canada’s seventh-largest trading partner in goods and services in 2024, with two-way trade valued at USD 30.8 billion . At the G20 Leaders’ Summit last year, both countries agreed to formally launch negotiations for a Comprehensive Economic Partnership Agreement aimed at increasing bilateral trade to USD 70 billion by 2030 .

The visit comes as Canada seeks to repair ties with India following a sharp diplomatic rupture in 2023, when then prime minister Justin Trudeau alleged a possible Indian link to the killing of Khalistani separatist Hardeep Singh Nijjar near Vancouver. India dismissed the charge as “absurd.” In October 2024, both countries expelled diplomats, though relations have since begun to stabilise, with high commissioners reposted in each other’s capitals after Carney’s election victory.

From India, Carney will travel to Canberra, where he will address both houses of Parliament, the first Canadian prime minister to do so in 20 years and meet Australian Prime Minister Anthony Albanese to discuss defence cooperation and AI development.

He will then visit Tokyo for talks with Japan’s prime minister on clean energy, critical minerals and food security.The tour reflects Canada’s push to reduce dependence on the United States amid rising trade tensions with US President Donald Trump and his threats of steep tariffs.

“In a more uncertain world, Canada is focused on what we can control. We are diversifying our trade and attracting new investment,” Carney said.