Economy, ties with India among key focus areas for Canada’s PM-elect Mark Carney
ByAnirudh Bhattacharyya
Mar 10, 2025 09:43 AM IST
New Delhi will be listening to what he says and figuring out whether Carney will offer an opportunity to repair a relationship that was beyond salvaging during Trudeau’s tenure.
During the federal election campaign in August 2021, outgoing Canadian prime minister Justin Trudeau said he didn’t think about monetary policy. Mark Carney, his successor as leader of the ruling Liberal Party, however, has had to have given that matter plenty of thought, given that he was Governor of the Bank of Canada between 2008 and 2013 and then Governor of the Bank of England from 2013 to 2020.
Liberal Party leader Mark Carney delivers his victory speech in Ottawa on March 9. (AP Photo)
Liberal Party leader Mark Carney delivers his victory speech in Ottawa on March 9. (AP Photo)
That may not be the only difference in their approaches. Since becoming prime minister in 2015, Trudeau pulled his party, once known for its centrism, increasingly to the left. The 59-year-old Carney, however, has described himself as a pragmatic outsider, despite acting as the chair of the task force advising Trudeau on economic growth since September last year. But, after declaring his candidacy for leadership in January, he increasingly distanced himself from Trudeau’s policies. During the election debate in English in Montreal last month, he said, “Our economy was weak before we go to these threats from President Trump.” That reference, of course, was to the tariff threats Canada has faced from US President Donald Trump, which became the defining issue for the federal elections.
In fact, his campaign platform attacked Trudeau’s policies, saying, “Too many Canadians, particularly younger Canadians, have been knocked back by the pandemic and the cost-of-living crisis — setbacks made worse by the surge in immigration and the shortfall in affordable housing.”
New Delhi will be listening to what he says and figuring out whether Carney will offer an opportunity to repair a relationship that was beyond salvaging during Trudeau’s tenure. That process of it falling apart started when Trudeau stated in the House of Commons on September 18, 2023, that there were credible allegations of a potential link between Indian agents and the killing of pro-Khalistan figure Hardeep Singh Nijjar in Surrey, British Columbia, three months earlier. In October last year, matters worsened, after Ottawa asked New Delhi to waive diplomatic immunity for six Indian officials stations in Canada so they could be interrogated in connection with violent criminal activities in the country. India withdrew them instead and expelled six Canadian diplomats as a retaliatory measure.
Prior to the 2023 breakdown, there were promising signs of the two countries forging an Early Progress Trade Agreement, or EPTA, as negotiations were in an advanced stage. But that was “paused” in August that year and that action was later linked to the Nijjar killing.
Given that is in the midst of a trade war with Washington, its neighbour and so far its closest ally, and China, which also targeted Canadian products like canola oil last week, Ottawa will need to pivot to other markets. Carney appears to have recognised that reality, as he indicated in Calgary on March 4. Responding to questions from the media in the Alberta city, Carney said, “What Canada will be looking to do is to diversify our trading relationships with like-minded countries and there are opportunities to rebuild the relationship with India.”
“There needs to be a shared sense of values around that commercial relationship and if I’m Prime Minister, I look forward to the opportunity to build that,” he added.
Carney’s statement was welcomed by Ritesh Malik, chair of the Canada-India Foundation (CIF), who felt that given Carney’s “global perspective and recognition of strategic geopolitical importance” of India, “it’s plausible that his leadership could introduce a fresh approach to Canada-India relations, potentially fostering stronger economic and strategic ties between the two nations”.
Carney was the chair of Brookfield Asset Management till January this year, before resigning from the posts he held as he entered the leadership race. He should be familiar with India’s economy. After all, Brookfield has approximately US$ 30 billion assets under management in India across its strategies in real estate, infrastructure, renewable power and transition, private equity and special investments, a spokesperson for the company told HT.
Ajay Bisaria, former Indian High Commissioner to Canada, felt that Carney “will not carry the India baggage of Trudeau”. He expected a change in ties with a new PM, though that could emerge once the federal election is held in October this year, which could also come as early as this spring. Either way, the interim PM will have little time for reshaping the relationship. However, Bisaria said, “Any new Prime Minister of Canada will have a natural opportunity to get off ramp from the current political deadlock with India: stabilise the relationship, exchange High Commissioners and finalise a trade agreement, given the broader geopolitical problems that Canada now has with the US and with China.”
“We shouldn’t assume an automatic reset, it will still require work,” Vina Nadjibulla, vice-president of research and strategy at the Asia-Pacific Foundation of Canada, warned. Both governments are in a “wait and see mode” related to the “political transition,” she said. But, Carney, she argued, should be “able to recognize the value in the partnership”.
There will be certain hurdles, including the outcome of the ongoing trial in British Columbia of the four Indian nationals charged with alleged involvement in Nijjar’s murder. In addition, there’s the ever-present spectre of influential pro-Khalistan elements exerting pressure upon the next Government. Whether there is a desire to manage that challenge will only unfold in the future.
Carney could be susceptible to those pressures, or not, but what he will not bring to the table will be the antipathy felt in New Delhi towards Trudeau personally. And, obviously, economic acumen and experience, unlike his predecessor.
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