Sidhu, on a three-day visit to India, met Commerce Minister Piyush Goyal for what he described as a very productive ministerial dialogue focused on sectors including critical minerals, clean energy, agriculture and artificial intelligence.

Why it matters: India, a major market for Canadian pulses, recently imposed a 30 per cent tariff on yellow pea imports.

“The meeting went really well. We focused on areas of opportunity – aerospace, AI, critical minerals, energy, agriculture – and what more we can do together,” Sidhu told Reuters in an interview after the meeting.

Sidhu’s visit marks a major high-level trade engagement since Canada paused negotiations for a broad trade pact in 2023, after relations soured when Ottawa accused New Delhi of involvement in the killing of a Canadian Sikh separatist.

Sidhu said the two sides were now “in early discussions to restart the process”, referring to global economic shifts including the imposition of high tariffs by the United States on goods from both countries.

He said the government of Canada’s new Prime Minister Mark Carney brought “a new focus, new energy and new mandate”, and was keen to enhance cooperation with India to attract investment in the energy and critical minerals sectors.

“Canada has every element needed to build an electric battery,” Sidhu said, adding that Ottawa welcomed investment from India in mining critical minerals and infrastructure projects.

Relations between the countries began to improve following Prime Minister Narendra Modi’s meeting with Carney on the sidelines of the G7 summit in June.

India is a priority market for Canada, with two-way goods and services trade reaching about $31 billion in 2024, largely in Canada’s favour due to its $16 billion services exports.

India is Canada’s biggest source of immigrants, with nearly 393,000 Indian students in 2024 and more than 1.8 million Canadians of Indian origin.

Sidhu met executives from Indian conglomerates, including Tata, and said they wanted to do more in Canada.

He also said Goyal had committed to visiting Canada soon with a trade and investment delegation.

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The negotiations, led by officials from India’s commerce ministry and a U.S. trade delegation headed by Brendan Lynch, assistant U.S. trade representative for South and Central Asia, were held from March 26-29.

Why it matters: India and the U.S. are key agricultural trading partners for Canada

Separately, U.S. Deputy Secretary of State Christopher Landau spoke with Indian Foreign Secretary Vikram Misri about efforts to reduce trade barriers and achieve a “fair and balanced bilateral trade relationship”, while also strengthening defense and technology cooperation to bolster regional security.

Landau thanked India for its efforts in addressing illegal immigration to the United States and urged continued cooperation, the U.S. Department of State said in a statement.

The talks come as U.S. President Donald Trump prepares to impose reciprocal tariffs on multiple trading partners from April 2, with India hoping for an exemption amid the bilateral talks. Both countries aim to sign the first tranche of a bilateral trade deal by autumn.

“The successful conclusion of the discussions reflects progress in efforts to expand India-U.S. bilateral trade and investment relations to promote prosperity, security and innovation in both countries,” a statement by India’s commerce ministry said.

Last month, during Prime Minister Narendra Modi’s visit to Washington, India pledged to boost purchases of U.S. energy products and defense equipment, and the two sides agreed to aim for a deal targeting bilateral trade of $500 billion by 2030.

Trump has called India a “tariff king”, with the U.S. wanting India to reduce levies on products ranging from agricultural goods and alcoholic beverages to automobiles, and seeking greater market access for U.S. companies.

Piyush Goyal, India’s trade minister, visited Washington earlier this month for talks with U.S. Trade Representative Jamieson Greer and Commerce Secretary Howard Lutnick.

Sector-specific expert engagements for the bilateral trade agreement will begin virtually in the coming weeks, followed by an in-person negotiating round, the joint statement said.

The U.S. currently has a $45.6 billion (C$65.6 billion) trade deficit with India. While the U.S. trade-weighted average tariff rate stands at about 2.2 per cent, India’s average tariff is significantly higher at 12 per cent, according to World Trade Organization data.

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Unlike China, Canada and the European Union, India is actively seeking to appease the Trump administration and is open to cutting tariffs on over half of U.S. imports worth $23 billion (C$32.9 billion), Reuters reported earlier this week.

In a series of meeting in New Delhi with Brendan Lynch, the assistant U.S. trade representative for South and Central Asia, India agreed to cut tariffs on bourbon whiskey and agricultural products such as almonds, walnuts, cranberries, pistachios and lentils, one of the sources familiar with discussions, said.

The talks to fast-track negotiations is likely to conclude late Friday.

Trade talks are “progressing well” and the bilateral trade pact, still in progress, will benefit both nations, Indian Trade Minister Piyush Goyal said on Thursday.

“Securing a favourable deal is a priority for Indian negotiators,” a second government source said, adding that India has aligned its offers with U.S. priorities, particularly in the agriculture industry and some other sectors.

Both sources spoke on condition of anonymity due to the sensitivity of the talks.

India’s trade ministry didn’t respond to email request for comment, while the U.S. embassy spokesperson in New Delhi said: “We don’t have anything to share on private diplomatic discussions.”

India lowered duties for bourbon whiskey to 100 per cent from 150 per cent last month. Import duties range from 30 per cent to 100 per cent on agricultural products like cranberries, almonds, walnuts, and around 10 per cent on lentils.

However, there is still resistance in government circles to lowering tariffs for dairy products, rice, wheat and maize, the source said, adding India is seeking greater market access for shipments of fruits like pomegranates and grapes besides rice to the U.S. market.

The negotiators are expected to agree on the framework for the broad contours of the first phase of the bilateral deal, expected to be signed by fall 2025, the sources said.

In 2024, exports of U.S. agriculture and allied products to India totalled nearly $2 billion, including $452 million in alcoholic beverages and $1.3 billion in fruits and vegetables while India’s exports to the U.S. stood at about $5.5 billion.

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To tackle Trump’s threat of a “reciprocal tax” on Indian goods for high tariffs, some officials of the Indian commerce ministry are ready to consider cuts on certain products such as pork, a senior government source said. Currently India slaps about a 45 per cent import tariff on pork, which is mostly supplied by the U.S.

Tariffs could also be reduced on high-end medical devices such as pace makers and luxury motor-cycles, including Harley Davidson, said a second official with direct knowledge of trade issues, citing the 25 per cent to 60 per cent tariffs on these products.

With bilateral trade between India and the U.S. exceeding $118 billion (C$169.6 billion) in the 2023/24 fiscal year ending in March, and India enjoying a $32 billion (C$45.0 billion) trade surplus, the country is readying for trade talks with the U.S., aiming to clinch a broader trade and investment deal once president-elect Donald Trump takes office.

To address Trump’s concerns over the trade imbalance, officials have also proposed buying more LNG and defence equipment from the U.S., the second official said.

India’s energy imports from the U.S., including crude oil, refined fuel and coal, were estimated at $12 billion (C$17.2 billion) in fiscal 2024, and aircraft and parts at $2 billion (C$2.9 billion). Such imports could rise by $5 billion to $10 billion ($C14.4) annually, a third government source, said.

The government and industry sources spoke on condition of anonymity because the discussions remain confidential.

A commerce ministry spokesman declined to comment.

Commerce ministry officials have previously said they would wait for the Trump administration to take office before any offer of trade talks, while working out plans for possible negotiations.

Indian officials are also sensing an opportunity in Trump’s plans to impose up to 60 per cent tariffs on Chinese imports, by pitching India as an alternative manufacturing base.

The government has held consultations on the issue within ministries, as well as with local think-tanks and industrial groups, said a government source who attended some of the meetings.

Trump good for India

“That is an opportunity,” said Arvind Virmani, a government adviser and member of the state-run policy think-tank NITI Aayog.

“It is in the interest of the U.S. and India that more of critical manufacturing or the sensitive manufacturing be done in India rather than China,” he said, adding a “preferential trade cum investment deal,” which is more ambitious than an earlier proposed mini-trade deal, would benefit both countries.

Ajay Sahai, director general at the Federation of Indian Export Organisations, said high tariffs on goods from China would accelerate the process of global companies moving to India.

“We have to do our homework… Overall the coming of Donald Trump is definitely good for India,” he said.

During Trump’s first term, a proposed mini-trade deal aimed at addressing trade imbalances and strengthening trade ties through limited agreements faltered over disagreements on tariffs, market access and intellectual property.

India is now seeking a broader deal, offering significant concessions including production-linked incentives for shipping and support for logistics companies.

“Under Trump’s ‘Make in America program’, India could extend concessions for U.S. companies for manufacturing low-end products in India for their supply chains,” said Ram Singh, a trade analyst at the state-run Indian Institute of Foreign Trade.

In the semiconductor sector, for instance, he said, India could become a hub for the production of low-end chips as part of the global supply chain while U.S. companies focused on high-end products.

Noting that India has attracted investments, such as Apple Inc’s iPhone production, the sources said the government plans to offer further incentives in sectors like aircraft maintenance, semiconductors, electronics and renewables.

India also plans to allow 100 per cent foreign direct investment in the insurance sector, up from the current 74 per cent in a move that could help leading US insurers like AIG.

The plan would require parliament approval.

— Additional reporting by Shivangi Acharya

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India marks its founding as a republic on Tuesday with a military parade in the historic city centre, but the farmers, who are demanding a rollback of Prime Minister Narendra Modi’s deregulation effort, plan their own peaceful show of strength.

Delhi’s police said protesters have been told to use three main routes for the tractor procession, which had been agreed upon after six days of discussion with farmer leaders.

But there are lingering concerns that “anti-national people” may seek to foment trouble during the demonstration, Delhi Police Commissioner S.N. Shrivastava told reporters.

“We are aware of all this and we are taking whatever action is required,” Shrivastava said, “I have trust that everything will go on peacefully.”

On National Highway 44, loudspeakers blared anti-government songs as the lengthy procession of vehicles rolled down, fuelled by dozens of community kitchens that handed out hot meals and beverages in the winter cold.

“We will teach Modi a lesson that he will never forget,” said one of the protesters, from the district of Ludhiana in Punjab, who drove his own tractor. The 35-year-old, who cultivates 10 acres, asked not to be identified.

Farmers mainly drawn from the breadbasket states of Punjab and adjoining Haryana have blockaded approaches into New Delhi for about two months to protest against three new farm laws they say will hurt their livelihoods and help big companies.

Their unions are pushing for repeal of the laws, after rejecting a government proposal to suspend the measures it says will usher in much-needed steps to boost farmer incomes.

Several rounds of talks with Modi’s government have made little headway, and protesters now aim to up the ante with the procession set to follow Tuesday’s military parade.

Top leaders and military officials attend the annual high-security parade to mark the day India’s constitution took effect in 1950.

A farmers’ group exhorted its members to refrain from violence in detailed instructions issued for Tuesday’s event.

“Remember, our aim is not to conquer Delhi, but to win over the hearts of the people of this county,” it said.

In the western state of Maharashtra, thousands of farmers were also on the move, flocking to a flag-hoisting ceremony on Tuesday in the heart of Mumbai, India’s financial capital.

“We are here to support farmers in Delhi, to highlight that farmers across the country are against the farm laws,” said Ashok Dhawale, a state protest leader.

— Reporting for Reuters by Manoj Kumar; additional reporting by Rajendra Jadav in Mumbai and Saurabh Sharma in Lucknow; writing by Devjyot Ghoshal.

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For more than a month, tens of thousands of farmers have camped on the outskirts of New Delhi, the capital, to protest against reform measures that they say benefit large private buyers and harm growers.

Chief Justice Sharad Bobde told a hearing the Supreme Court would set up a panel to hear the farmers’ grievances.

“We have the power to make a committee and the committee can give us the report,” he said, ordering the stay for an undisclosed period on the laws passed in September.

“We will protect farmers.”

There were no immediate further details.

Farm leaders said their demand for a full repeal of the laws remained unchanged.

“We are grateful to the Supreme Court for its positive response,” said Rakesh Tikait, president of one of the largest farmers unions, Bharti Kisan Union.

“The protests will continue until demands are met.”

India says the laws aim to modernize an antiquated farming system, bedevilled by wastage and bottlenecks in the supply chain.

But farm leaders say the reforms are an attempt to erode a longstanding mechanism that ensures farmers a minimum support price for their crops.

The government has said there was no question of dropping the reforms and eight rounds of talks have failed to find common ground. The two sides are set to meet again on Friday.

— Reporting for Reuters by Suchitra Mohanty and Manoj Kumar; writing by Alasdair Pal.

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In eastern and western states, farmers blocked roads and squatted on railway tracks, delaying hordes of people getting to work, and preventing perishable produce from reaching markets.

Farmers from the northern states of Punjab and Haryana, neighbouring New Delhi, have been at the vanguard of the agitation since last month, and have set up protest camps in and around the capital.

“We will not allow the government to change the rules because they want to hurt farmers’ income by filling the pockets of big companies,” said Gurwinder Singh, a 66-year-old farmer from Punjab, a state known as the food bowl of India. The reforms enacted in September loosened rules around the sale, pricing and storage of farm produce that have protected farmers from an unfettered free market for decades.

Assured of floor prices, most currently sell the bulk of their produce at government-controlled wholesale markets, known as mandis.

The ruling Bharatiya Janata Party (BJP) has said the reforms would not hurt farmers’ incomes. More talks between the government and farmer organizations are due on Wednesday.

Home Minister Amit Shah late on Tuesday invited leaders of protesting farmers’ unions for talks.

“Most likely, the government on Wednesday will give a written proposal about the likely amendments in the laws. Once we receive the proposals, we will examine them,” farmers’ leader Hanan Molla told reporters after the meeting.

Social media has fanned sympathy for the farmers’ cause among the Indian diaspora abroad. During recent days, thousands of people have protested in support of the farmers outside the Indian embassy in central London. In Canada, rallies were reported over the past week in cities including Toronto, Calgary, Winnipeg and Charlottetown.

During the coronavirus pandemic, protest sites around New Delhi have turned into camps, with entire families cooking and sleeping in the open and Sikh religious organizations were providing them with face masks, water and food.

— Reporting by Reuters’ India bureau; writing by Rupam Jain and Mayank Bhardwaj.

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Walmart said on Wednesday it would pay some US$16 billion for a roughly 77 per cent stake in the Indian e-commerce firm, stepping up competition with rival Amazon.com in a major growth market.

While Thursday’s protest was small and unlikely to affect the deal, such sentiments pose a challenge for Indian Prime Minister Narendra Modi and his Hindu nationalist Bharatiya Janata Party (BJP) as it prepares to fight an election next year.

For Modi, appeasing small traders and farmers, who are part of the BJP’s core constituency, is as important as upholding India’s image as a place that welcomes foreign investment.

Officials have been advised not to comment on the Walmart-Flipkart deal, a senior government official said. The ruling party has previously opposed foreign direct investment in the multi-brand retail sector.

“Politically, the government may find it difficult to digest the deal,” the official said.

The Communist Party of India (Marxist) also taunted the Modi government, noting the BJP had decried such investments when it was in the opposition and accusing it of betraying promises.

Officials in the Prime Minister’s office did not respond to calls by Reuters for comment.

According to the deal, Walmart’s investment is in Flipkart’s online marketplace platform, where foreign investment is allowed. The U.S. company cannot open physical stores in India, according to rules governing the multi-brand retail sector.

However, Walmart’s CEO Doug McMillon told media in New Delhi on Thursday that it was open to the idea of setting up stores via a franchise model in the future. It already operates wholesale stores in the country.

“We can be very flexible. I think as a company not just in India, but around the world, the concept of franchising isn’t out of bounds,” said McMillon, adding Walmart was not yet ready to make any such announcements.

That could fan fears of some trader and farmer groups, who contend the U.S. company is using the deal as a back-door entry into India’s bricks-and-mortar retail market, and that it could squeeze out small corner shops that dominate Indian retail.

Fringe protests

Some 80 people gathered outside a Delhi hotel holding placards reading “Walmart Go Back!” and shouting slogans asking people to ditch imported products for Indian-made goods. Inside the hotel, McMillon was talking to a dozen journalists about the deal.

“Whoever is protesting also has a story to tell. If you look at our history as a country, there was a history of colonialism. And there is always a fear that you start with trade and then it becomes control,” said Devangshu Dutta, head of retail consultancy firm Third Eyesight.

The protesters were from the Swadeshi Jagran Manch (SJM), a nationalist group linked to Rashtriya Swayamsevak Sangh (RSS), the ideological parent of Modi’s party. The group has said the deal is against “national interests” and will hurt Modi’s “Make in India” drive.

It has also written to Modi asking the government to intervene.

Separately, a traders’ union, the Confederation of All India Traders (CAIT) said that it may consider taking legal action against the two companies or lodging a complaint with the country’s competition watchdog, depending on how the deal was structured.

Traders say they are most concerned about predatory pricing and steep discounting by e-commerce firms with deep pockets thanks to foreign funding that could edge out smaller rivals.

“Already offline trade is deeply hurt by e-commerce as there is no policy or regulatory mechanism to govern those companies,” said Praveen Khandelwal, secretary general of CAIT.

“It is a free-for-all game and ultimately it is the offline trade which is feeling the pinch.”

— Reporting for Reuters by Aditi Shah and Manoj Kumar; additional reporting by Adnan Abidi and Euan Rocha in New Delhi and Sankalp Phartiyal in Mumbai.

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At the end of July, Prime Minister Narendra Modi pulled the plug on implementing a so-called trade-facilitation deal struck in Bali last year, linking it to the emotive issue of rural poverty in his country of 1.25 billion people.

India wants to keep a so-called ‘peace clause’ that protects its huge state food purchases until the World Trade Organization can strike a definitive deal on stockpiling. As originally envisaged in Bali, the clause would expire in four years.

Critics say food stockpiling amounts to paying farmers to produce food, building food surpluses that will eventually get dumped on world markets.

New Delhi’s blockade has plunged the WTO into its worst crisis in two decades, leading Director General Roberto Azevedo to float the idea of abandoning the consensus principle on which the 160-member group operates.

Modi’s tough line jars with the ‘Make in India’ pitch he has taken to investors abroad in his first five months in charge. Having failed to make progress on trade when he met U.S. President Barack Obama in Washington, he could be isolated at his first G20 summit of world leaders in Brisbane, Australia, on Nov. 15-16.

“India’s position on trade facilitation has been completely misunderstood because of unreasonable positioning by some of the developed countries,” Finance Minister Arun Jaitley told a World Economic Forum conference in New Delhi.

Jaitley repudiated suggestions that India was fundamentally opposed to trade facilitation, which would entail easing port and customs procedures.

A senior U.S. trade official said there was still hope all WTO members would agree but “if we are unable to do so I think there is a lot of interest among countries in exploring alternatives for those countries who at least initially want to move ahead with those obligations.”

Quiet diplomacy

India has begun backroom efforts to break the deadlock, sending a top trade ministry official to Geneva this week for talks with Azevedo and key WTO members.

Trade diplomats said there was no hint, however, that a compromise could be reached on India’s demands, which have been vague and varied in the months since its veto.

On Monday, Modi held a meeting of Indian trade ministry officials to discuss how the deadlock could be broken without compromising India’s food-security concerns.

“If India has to submit a proposal, it would be presented at the right time,” a senior trade ministry official with direct knowledge of the matter told Reuters.

India refuses to bow to foreign calls to scale back a scheme to buy wheat and rice that it distributes to 850 million people. In a recent disclosure to the WTO, India said those purchases cost $13.8 billion in 2010-11, part of the $56.1 billion it spent in total on farm support.

“All that we are requesting is the settlement of the dispute with regard to the food stock holdings, and the peace clause must continue to co-exist,” Jaitley said.

Diplomats say that without a WTO deal on trade facilitation, countries could simply tack the draft agreement onto their existing membership terms. They say this would put the onus on India to object, and explain why its interests had been damaged.

Yet economists say WTO members lack any effective means to bring pressure to bear against Asia’s third-largest economy, home to a sixth of the world population.

“It’s an issue that in India is so politicized; you have hordes of the population living in poverty and depending on food aid,” said Shilan Shah, an economist who covers India at Capital Economics in London.

“The WTO hasn’t really shown the kind of will to move on without India’s agreement. What it demonstrates is how important India is to the global trading community.”

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