PIB TrackerIndia and Canada push CEPA negotiations forward
India's Commerce Minister travels to Canada to drive the second round of talks on a comprehensive bilateral trade pact aiming at USD 50 billion in trade by 2030.
What happened
- The Union Minister of Commerce and Industry travelled to Canada from 25–27 May 2026 to advance the ongoing negotiations of the Comprehensive Economic & Partnership Agreement (CEPA) between India and Canada.
- Senior representatives from over 100 Indian businesses accompanied the Minister, drawn from metals and mining, energy, automotive and capital goods, aerospace, tourism, leather and textiles, agriculture, telecom and pharmaceuticals.
- The Minister was scheduled to meet Canada's Minister of International Trade and review the progress of the CEPA, and to call on the Prime Minister of Canada and the Minister of Foreign Affairs to widen strategic cooperation.
- The trip doubled as a working leg of the second round of CEPA negotiations, with Indian officials continuing the talks on the ground; both sides reaffirmed a commitment to fast-tracking the agreement.
- The visit also covered CEO, startup and pension-fund interactions, with energy security, the energy transition, civil nuclear cooperation, and AI and standards cooperation flagged as priority tracks.
Background & context
A CEPA — a Comprehensive Economic and Partnership Agreement — sits in the family of India's "comprehensive" trade treaties alongside the CEPAs India has signed with Japan, South Korea and the UAE, and the broader CECA (Comprehensive Economic Cooperation Agreement) it concluded with Singapore and Malaysia. What distinguishes this family from a plain free-trade agreement is breadth: a CEPA goes beyond cutting tariffs on goods to also liberalise trade in services, ease investment, and address allied chapters such as movement of professionals, intellectual property, standards and regulatory cooperation. That width is the key examinable distinction and the reason the talks pull in 100-plus firms across both manufacturing and services sectors rather than only exporters of merchandise.
The India–Canada relationship had cooled sharply through 2023–2024 before structured engagement resumed from mid-2025. The current momentum was set in motion by the visit of the Canadian Prime Minister to India on 2 March 2026, during which the two governments formally launched the CEPA negotiations. A Canadian official delegation then visited New Delhi from 4–7 May 2026 for the second round of negotiations, and the Commerce Minister's late-May trip to Canada continued that same round on Canadian soil. Both governments have publicly framed the pact as a vehicle to restore and then deepen a partnership that had stalled, with trade as the anchor and energy, civil nuclear cooperation, science and technology, and people-to-people ties as the supporting pillars.
Trade between the two economies remains modest in absolute terms. In FY2025–26, bilateral trade stood at roughly USD 8 billion, split between Indian exports of about USD 4.67 billion and imports of about USD 3.28 billion — leaving India with a small trade surplus. Against that base, the two sides have set a shared ambition of lifting bilateral trade to USD 50 billion by 2030, a step-change that only a broad-based agreement, rather than a narrow tariff deal, could plausibly support. Canada's large resource and energy endowment and India's expanding energy demand are described as natural complementarities, which is why energy security and the energy transition feature so prominently alongside the formal trade chapters.
It helps to be precise about how a CEPA differs from the instrument with which it is most often confused. A plain free-trade agreement (FTA) is, at its narrowest, a goods deal: the partners cut or eliminate customs duties on each other's merchandise. A CEPA is the wider category — alongside CECA, it is the label India uses for its most comprehensive treaties. Beyond goods, it typically opens up trade in services (where India has offensive interests in IT, professional and education services), creates a more predictable framework for two-way investment, and adds chapters on areas such as the temporary movement of professionals, intellectual property, technical standards and customs and regulatory cooperation. Because of that scope, the negotiating team and the accompanying business delegation span both manufacturing exporters and services and investment players — which is why over a hundred firms across more than nine sectors travelled with the Minister. The single most testable distinction: a CEPA is broader than a goods-only FTA, and at the May 2026 stage it remains under negotiation, neither signed nor in force.
The energy and resource dimension deserves its own note, because it is where the complementarity is sharpest. Canada is a major producer of uranium, oil, natural gas, potash and a range of critical minerals; India is a large and growing importer of energy and of the inputs its clean-energy transition will need. The release singles out civil nuclear cooperation as a cornerstone of the energy partnership — a notable framing given that nuclear was historically a point of friction between the two countries before cooperation was rebuilt. Layered on top are newer tracks the two governments want to develop: cooperation in artificial intelligence research, standards and innovation ecosystems, and a long-standing science-and-technology relationship supported by regular institutional engagement. Trade is therefore the anchor of the CEPA, but the agreement is being positioned inside a wider basket of energy, nuclear, technology and people-to-people cooperation.
For Prelims
- Full form: CEPA = Comprehensive Economic & Partnership Agreement — a wide-scope trade treaty covering goods, services and investment, not a goods-only deal.
- Status: Under negotiation; launched 2 March 2026 during the Canadian PM's visit to India.
- Rounds so far: Second round held in New Delhi 4–7 May 2026, continued during the Commerce Minister's 25–27 May 2026 Canada visit.
- Nodal ministry (India): Ministry of Commerce & Industry; trade talks led on the Indian side by the Department of Commerce. Canadian counterpart: the Minister of International Trade.
- Trade data (FY2025–26): Total ~USD 8 bn · India exports USD 4.67 bn · India imports USD 3.28 bn (India runs a surplus).
- Headline target: Bilateral trade of USD 50 billion by 2030.
- Energy & nuclear: Civil nuclear cooperation described as a "cornerstone" of the energy partnership; energy security and the energy transition listed as priority tracks.
- Diaspora: ~2.8 million strong Indian community in Canada (~1.8 million Indo-Canadians and ~1 million NRIs including students) — described as a "living bridge".
- Delegation: Over 100 Indian businesses across metals & mining, energy, automotive, aerospace, tourism, leather & textiles, agriculture, telecom and pharmaceuticals.
- What it is NOT: A CEPA is not a goods-only FTA — it additionally liberalises services and investment and may cover IP, standards and movement of professionals. It is also not yet signed or in force — only the negotiation stage has begun.
- The comparative set — India's "comprehensive" trade pacts: CEPA with Japan (2011), South Korea (2010) and the UAE (2022); CECA with Singapore (2005) and Malaysia (2011); plus the broader India–EFTA TEPA (Trade and Economic Partnership Agreement, signed 2024) and the India–Australia ECTA (an interim economic cooperation and trade agreement). The India–Canada CEPA would join this comprehensive-agreement family.
Why it matters
The significance is as much diplomatic as commercial. The CEPA is the centrepiece of a deliberate reset between two democracies whose ties had broken down, and trade is being used as the stabilising anchor — a concrete, mutually-beneficial agenda around which a strained relationship can be rebuilt. The problem it addresses is twofold: first, the relationship deficit left by the 2023–2024 downturn, which the structured engagement since mid-2025 is meant to repair; and second, the under-realisation of an obvious economic complementarity — Canada's deep energy, critical-minerals and natural-resource base set against India's fast-rising energy and raw-material needs. At roughly USD 8 billion, two-way trade sits well below the potential of two G20 economies, and the USD 50 billion target signals the scale of the gap both sides want to close.
For India specifically, a Canada CEPA fits a wider strategy of locking in market access through bilateral deals at a time when large plurilateral negotiations are slow and the global trading order is more contested. Over the past few years India has concluded the UAE CEPA (2022), the Australia ECTA, and the India–EFTA TEPA (2024), and has pursued talks with the United Kingdom and the European Union — a pattern of stitching together a network of bilateral and pluri-lateral pacts rather than relying on a single multilateral track. The Canada negotiation slots into that pattern, and its rapid sequencing — launch in early March, second round under way by early May — signals an intent to move quickly while the political reset holds.
It also carries a strong diaspora dimension: the 2.8-million-strong Indian community in Canada — about 1.8 million Indo-Canadians and around 1 million NRIs including a large student population — is both a political constituency and an economic conduit, and a stable trade architecture underpins the people-to-people and education links that the 2023–2024 downturn had unsettled. The release describes this community as a "living bridge", and a functioning CEPA, by giving the relationship a durable institutional spine, is meant to insulate those human ties from future political shocks. The structured strategic and security engagement that the two sides have resumed in parallel reinforces the same point: the trade pact is one strand of a deliberate, multi-channel normalisation rather than a stand-alone commercial exercise.