The diplomatic relations between India and Canada deteriorated after then Prime Minister Justin Trudeau accused India of involvement in the killing of Khalistan terrorist Hardeep Singh Nijjar in British Columbia in September 2023. This later led to a major diplomatic rift. Diplomatic expulsions and visa restrictions were also part of this. Although bilateral trade reached 13.49 billion Canadian dollars in 2023, deeper economic cooperation was hampered due to political differences. Carney's willingness to restore this gives hope for the relationship between the two countries. In a recent media debate in Calgary, Carney had stated that India is an important partner for developing Canada's trade partnership. Experts say this indicates that Carney wants good diplomatic relations with India.
Indian students make up a significant portion of Canada's 427,000 international student population. The future of these students is of great importance to India. The Liberal Party has recently taken a more restrictive approach to immigration and international student admissions as part of its efforts to address Canada's housing and infrastructure crisis. The Liberal Party has announced that it will cap the number of immigrants, including international students and temporary workers, by the end of 2027. If that happens, the influx of foreign students to Canada will decrease. This is likely to affect Indian students as well. The Liberals' manifesto also includes plans to streamline the recognition of foreign qualifications and speed up immigration processing times.