(Source: Reuters)

Canada’s deepening dispute with India over its alleged campaign of violence against Sikhs in Canada.

It could step up cyber espionage in India and stop immigration, but analysts and experts see no immediate impact on trade.

The concern of a growing rift between the two countries comes after a senior Canadian official told a parliamentary national security committee on Tuesday that Indian Home Affairs Minister Amit Shah, a close ally of Prime Minister Narendra Modi, was the mastermind behind the alleged plots.

While Indian officials denied the official’s statement, the disclosure could exacerbate a dispute that began a year ago when Prime Minister Justin Trudeau cited credible evidence linking Indian agents to the June 2023 shooting of Sikh leader Hardeep Singh Nijjar in Colombia British.

In response, Canada expelled six Indian diplomats earlier this month, accusing them of involvement.

Four men have been charged with his murder.

The Canadian Signals Intelligence Agency, which monitors cyber threats abroad, said New Delhi was most likely already conducting threatening cyber activities against Canadian networks for espionage purposes.

“Because Canada and India may have some tensions, we may see India looking to direct those cyber threat actions against Canadians.” Caroline Xavier, head of the agency, known as Communications Security Establishment Canada, told a news conference Wednesday.

The agency has previously described India as an emerging threat.

On the diplomatic front, Ottawa is unlikely to take further punitive measures until more details about the Nijjar case emerge, said Vina Nadjibulla, vice president of the Asia Pacific Foundation of Canada think tank.

Cabinet ministers are due to testify about the matter before the national security committee, and the murder trial of the four men has not yet begun, she noted.

“If there are charges filed against people living in India at any level, then it would trigger an extradition process that could take years. And, of course, India is unlikely to cooperate,” she said.

Officials working for Trudeau and Foreign Affairs Minister Melanie Joly did not respond to requests for comment on what steps Ottawa might take next.

India is the main source of temporary foreign workers and international students coming to Canada, but a backlog of applications has piled up since Trudeau’s accusations last year.

Canada has just four immigration officials in India, down from 27 in October 2023. This affects Canada’s ability to process visas on the spot, Immigration Minister Marc Miller said.

“I told my colleagues in Parliament that this could get worse before it gets better and that they need to prepare for that,” he said in an interview last Friday.

That could mean fewer people traveling between countries for legitimate reasons, he said.

COMMERCIAL RELATIONS

India is Canada’s 10th largest trading partner, and New Delhi has made it clear it does not want flows affected. Nadjibulla’s foundation produced a study showing that Trudeau’s October 2023 statement had little or no effect on bilateral trade.

“If that were the case now, I think it’s a bigger question mark because the disruption is on a larger scale and we’re not, I don’t think, at the bottom of that yet,” she said on the phone.

Canada is the largest exporter of pulses, such as lentils, to India. Pulse Canada president Greg Cherewyk, when asked about the potential impact of the diplomatic spat, cited the strength of the relationship.

“At a time of stubborn food price inflation and strong demand for pulses, we are confident that affordability and availability will continue to drive government decision-making.” he said in a statement.

“Fortunately, we have not seen political tensions affect trade,” said Michael Harvey, executive director of the Canadian Agribusiness Alliance.

“India and Canada have great potential in their trade relationship and CAFTA hopes we can return to positive trade talks.”