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The upcoming India – Canada talk

Context

  • India and Canada will be discussing ways to take forward talks on the proposed bilateral trade and investment pacts next week.
  • On the agenda will also be measures to remove irritants, including those affecting trade in goods, especially ‘high’ tariffs on farm items such as pulses, and services, particularly ‘curbs’ relating to easier movement of skilled workers.

Canada-India Free Trade Agreement (FTA)

  • In the proposed Canada-India Free Trade Agreement (FTA), officially known as the Comprehensive Economic Partnership Agreement, it is expected to exchange their respective services trade wish list, indicating the areas where they would like to gain from the trade pact.
  • India is focusing on ensuring easier movement of Indian skilled workers to Canada for short-term work.
  • The last round of FTA negotiations saw modalities on goods trade taking shape.
  • The proposed bilateral Foreign Investment Promotion and Protection Agreement (FIPPA) is about to be finalized. India and Canada had concluded the FIPPA talks in June 2007, however, the agreement has not yet been ratified and made operational.
  • India is learnt to have had reservations regarding the inclusion of provisions on the Investor-State Dispute Settlement (ISDS) mechanism in the FIPPA.
  • The ISDS, enables investors to sue governments before international tribunals and seek huge compensation for the economic harms they suffer due to reasons including policy changes.
  • India has been negotiating its investment pacts on the basis of its new Model Bilateral Investment Treaty Text since December 2015.

Increase in Customs duty

  • India’s recent decision to increase the rate of basic customs duty on peas to 50% from nil duty has upset Canada which is a major pulses exporter to India.
  • The Indian government said that the duty increase was compliant with the World Trade Organization norms, adding that the move was taken due to the bumper harvest of pulses in India.

Trade in services

  • On trade in services, India will reach for easing norms in Canada, Canada’s Temporary Foreign Worker Program to help Indian skilled workers, especially professionals from the Information Technology field, to take up short-term project work.

The Canada-India Technology Summit

  • Three Canadian Ministers will lead a trade mission to India from November 13 to 17, accompanied by a delegation of nearly 200 Canadian business representatives.
  • The Ministers will participate in the Canada-India Technology Summit, where there will be several significant business and innovation announcements involving top-tier Canadian companies.

Increasing bilateral relations

  • Canadian investment into India has increased by nearly $15 billion over the past three years, and the number of Canadian companies active in India stands at over 1000.

India – Canada Relations

  • India-Canada share a strategic partnership reinforced by shared values of democracy and pluralism. These have expanded significantly in recent years aided by heightened economic engagement, regular high-level interactions and long-standing people-to-people ties.
  • Canada is home to over 1.2 million Persons of Indian Origin (PIO) who comprise more than 3% of its population. The highly educated, affluent and industrious PIOs, one of the largest immigrant groups in Canada are well integrated with the mainstream and also active politically.
  • At the political level, the relations in recent years have been marked by regular high-level interactions. Over the years an array of institutional mechanisms has been put in place to promote bilateral cooperation.

Political visits

  • Prime Minister Jean Chretien visited India in 2003 and PM Paul Martin in 2005. PM Stephen Harper paid an official visit to India from 15-18 November 2009.
  • PM Dr. Manmohan Singh visited Toronto from 25-26 June 2010 to attend theG-20 Summit, when a bilateral component was also added on 27th
  • PM Modi’s bilateral visit to Canada on April 14-16, 2015 was historic. He visited Ottawa, Toronto and Vancouver. He held extensive discussions with Canada’s political, business and academic leaders and also addressed some 10,000 PIO’s & friends of India, at Toronto on 15th

Important Memorandum of Understandings (MoU)

  • MoU between ISRO and the Canadian Space Agency concerning Cooperation in the field of Space;
  • MoU between the Ministry of Railways and Department of Transport of Canada on Technical Cooperation in Rail Transportation;
  • MoU between Ministry of Civil Aviation and Department of Transport of Canada on Deepening Cooperation in Civil Aviation;
  • Letter of intent Between Department of Biotechnology, Ministry of Science and Technology and Grand Challenges Canada for the implementation of Collaboration in disease elimination and Saving Brain Initiative.
  • An Agreement between the Indian Department of Atomic Energy and Cameco of Canada for long-term supply of uranium to India was also concluded (Second shipment reached India in December 2016).

Trade and Economy

  • The two-way trade has increased from C$ 4.2 billion (US$ 3.21 bn approx.) in 2010 to C$8.02 billion (US $6.05 bn approximately) in 2016, but does not reflect the true potential. India accounts for only 1.95% of Canada’s global trade.
  • Major items of India exports to Canada include gems, jewellary and precious stones, pharmaceutical products, readymade garments, textiles, organic chemicals, light engineering goods, iron & steel articles, etc.
  • India’s import from Canada include pulses, newsprint, wood pulp, asbestos, potash, iron scrap, copper, minerals and industrial chemicals, etc.
  • The cumulative India FDI, as per Statistics Canada in 2016 was C $2811 million (US$ 2093.53 million) as against Canadian FDI of C$ 1210 million (US$ 1693 million) in India.
  • Indian companies have invested especially in the IT, software, steel and natural resources sectors. Substantial operations in Canada include Aditya Birla Group, Essar Steel, Tata Consultancy Services, Tata Steel Minerals Canada, Tech Mahindra, WIPRO, Infosys Technology, Jubilant Life Sciences, Abellon Energy Inc, IFFCO and Gujarat State Fertilizers and Chemicals Limited(GSFC), Two Banks-State Bank of India and ICICI, have seven and nine branches respectively in Canada.
  • In the Joint Statement, issued during the visit of PM Modi, both sides agreed to pursue specific measures in this regard including early finalization of the Bilateral Foreign Investment Promotion and Protection Agreement(BIPPA).
  • The two leaders also welcomed the agreement on road map to expeditiously conclude a progressive, balanced and mutually beneficial CEPA. CEPA negotiations commenced in November 2010. The 9th round was held in New Delhi in March 2015.
  • India and Canada have also established institutionalized mechanisms to promote bilateral economic ties including Ministerial Dialogue on Trade and Investment; Trade Policy Consultations at the level of Additional Secretary, Department of Commerce; and the Economic and Financial Sector Policy.
  • The India- Canada CEO Forum was constituted in 2013 to improve bilateral trade and investment flows. The inaugural meeting of the Forum was convened in November 2013 in New Delhi.

Canada – India Parliamentary Friendship Group

  • Canadian Parliament has constituted a new Canada- India Parliamentary Friendship Group (CIPEG) with over 80 MPs from both Houses of Parliament cutting across party lines signing for its membership, making it the largest ever CIPEG.
  • A six member (MPs/Senators) Canadian Commonwealth Parliamentary Association (CPA) delegation visitedIndia on September 10 -14, 2016.

Cooperation in Energy sectors

Nuclear Energy:

  • The Nuclear Cooperation Agreement (NCA), which was signed in June 2010, came into force in September 2013.
  • The Appropriate Arrangement (AA) for the NCA was signed in March 2013, under which a Joint Committee on Civil Nuclear Cooperation was constituted. It held its first meeting in Mumbai on 29 November, 2013. The 2nd meeting was held in Ottawa in November 2014.
  • On 15thApril 2015, the Department of Atomic Energy signed a $350 million contract with Cameco, a Saskatoon-based company, to purchase 7 million pounds of uranium concentrate over the next 5 years. The first shipment arrived in India in December 2015.

Energy Dialogue:

  • Canadian Minister for Natural Resources Jim Carr led a government’s first official visit and trade mission delegation to New Delhi, India for India – Canada Energy Dialogue on September 7 – 9, 2016.
  • The delegation comprised twenty representatives both officials and representatives from Canada’s oil and gas, renewables and electricity, and academic sectors and were successful in creating new partnerships and new applications for renewable energy and clean technology.
  • A MOU on PNG cooperation between Ministry of PNG and NRCanwas concluded.
  • In addition, an Expression of Intent on collaboration between Alberta Marketing Petroleum Commission (APMC) and Indian Oil Corporation (IOC) was also signed, creating a framework to explore the prospects of APMC selling crude to IOC under-term contracts.

Education Sector

  • Over 100,000/- Indian students study in Canada. Education is a key area of collaboration between the two countries.
  • The MOU on Cooperation in Higher Education was signed in June 2010, which covers student and faculty exchange, research and curriculum development, organization of workshop and  seminars,  twining between institutions of higher learning, facilitate mutual recognition of educational qualifications, policy dialogue in areas of mutual interest, among others.
  • IC-IMPACTS (the India-Canada Centre for Innovative Multidisciplinary Partnerships to Accelerate Community Transformation and Sustainability), which is a Canada-India Research Centre of Excellence dedicated to the development of research collaborations between Canada and India, seeks to bring together researchers, industry innovators, community leaders, government agencies, and community organizations from across India and Canada to work together to find solutions to the key challenges facing the communities.
  • IC-IMPACTS is working with the National Mission for Clean Ganga to find innovative technological solutions to clean the river Ganga; the ‘Water for Health’ collaboration with Department of Biotechnology and with DST on ‘Safe and Sustainable Infrastructure’ and ‘Integrated Water-Management’ initiatives.

Science &Technology and Space

  • India and Canada have been cooperating since 1990s in the areas of space science, earth observation, satellite launch services and ground support for space missions.
  • ISRO and CSA (Canadian Space Agency) have signed MOUs for cooperation in the field of exploration and utilization of outer space and two Implementation Arrangements specifically addressing satellite tracking and space astronomy.
  • ANTRIX, the Commercial arm of ISRO, has launched nine nanosatellite under a commercial arrangement with University of Toronto – Institute of Aerospace Studies (UTIAS).
  • ANTRIX also launched a microsatellite SAPPHIRE as auxiliary satellites on the Polar Satellite Launch Vehicle (PSLV-C20) in February 2013.
  • The PSLV-C23, which was launched in June 2014 carried two Canadian satellites, CanX-4 and CanX-5, from the University of Toronto’s Institute for Aerospace Studies Space Flight Laboratory.

Indian Diaspora

  • The Diaspora is well represented in federal Parliament and provincial legislatures.
  • In the present House of Commons (elections held on 19 October 2015), there are 21 MPs of Indian origin (up from 9).
  • Four PIOs now hold Cabinet berths (up from two of Ministers of State in the last Cabinet).
  • Prominent Indo-Canadian organizations include Canada India Business Council (CIBC), Canada India Foundation (CIF), Indo-Canada Chamber of Commerce (I-CCC) and other local chambers and associations.
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