India and Canada advance economic ties and GIFT City pitch

India continues to promote GIFT City, its International Financial Services Centre, as a strategic hub for global capital. Following initial outreach by Gujarat Chief Minister Bhupendra Patel and Finance Minister Nirmala Sitharaman, recent diplomatic efforts have focused on strengthening economic ties with Canada.

During the inaugural Canada-India Economic and Financial Dialogue in Toronto, Sitharaman and Canadian Finance Minister François-Philippe Champagne discussed rebuilding economic relations following a period of significant tension. This tension, which reached a low point in September 2023 due to allegations regarding the killing of Sikh separatist Hardeep Singh Nijjar, led to diplomatic expulsions and reduced representation. Recent engagement under Prime Minister Mark Carney has seen the restoration of official channels and new agreements regarding uranium and critical minerals.

A primary objective is to expand bilateral trade to CAD 70 billion by 2030. Both nations also reaffirmed their intent to finalize a Bilateral Investment Treaty and are currently negotiating a Comprehensive Economic Partnership Agreement (CEPA), with a target completion date set for the end of 2026.

Sitharaman’s engagement with major Canadian institutional investors, such as Sun Life Financial, CPPIB, OMERS, and the Ontario Teachers’ Pension Plan, centered on sectors including renewable energy, critical minerals, digital infrastructure, and technology. She specifically highlighted the liberalization of India’s insurance sector, which now allows 100% foreign direct investment, and promoted GIFT City as a global gateway for international financial institutions. Discussions also emphasized leveraging India’s digital infrastructure, such as the Unified Payments Interface (UPI), to foster cooperation in fintech and green technology to build more resilient global supply chains.