From energy to critical minerals: What India and Canada want from CEPA

India and Canada are looking to reset their economic relationship through a proposed trade pact that could reshape bilateral commerce, unlock investment opportunities and deepen cooperation across strategic sectors. With the fifth round of negotiations on the Comprehensive Economic Partnership Agreement (CEPA) completed in Ottawa from October 5 to 9, 2026, both countries are targeting a deal by the end of the year.

The stakes are significant. Bilateral trade in goods and services reached C$30.4 billion in 2025, according to Canadian government data. The two countries aim to increase that figure to C$70 billion by 2030, more than doubling their existing trade relationship.

But what exactly is on the negotiating table, and what could the proposed agreement mean for businesses, workers and consumers in India and Canada?

Energy, critical minerals take centre stage

Energy security has emerged as a major priority in the negotiations, with Canada positioning itself as a potential long-term supplier to meet India’s growing energy requirements.

Canadian International Trade Minister Maninder Sidhu has highlighted opportunities in liquefied natural gas (LNG), alongside cooperation in critical minerals and aerospace. For India, greater access to energy supplies and essential industrial inputs could help support its economic expansion and manufacturing ambitions.

More from Explainers

Critical minerals are another strategic area, particularly as countries seek to diversify supply chains for advanced manufacturing, clean energy technologies and other industrial applications. Cooperation could span trade, investment, research and supply-chain development.

Aerospace, meanwhile, offers scope for closer industrial partnerships, technology collaboration and investment between businesses in both countries.

Market access and trade expansion

A key objective of CEPA is to improve market access and create new opportunities for exporters in both countries. The negotiations could address trade barriers and the terms under which goods and services enter each other’s markets, although the final concessions and commitments will depend on the agreement reached.

Canadian merchandise exports to India totalled C$3.9 billion in 2025, led by vegetables, mineral fuels and oils, and wood pulp. Its merchandise imports from India stood at C$9.7 billion, comprising mainly precious stones and metals, machinery, and pharmaceutical products.

For Indian exporters, a more favourable trading framework could create opportunities to expand sales in Canada, particularly in sectors already contributing to bilateral commerce. Canadian businesses, in turn, are looking to tap into India’s large and expanding consumer and industrial markets.

However, the precise benefits for individual industries will depend on the final terms governing tariffs, market access and other trade-related commitments.

Why Canada is looking beyond the US

The proposed pact also reflects Canada’s effort to diversify its export markets and reduce its dependence on the United States.

India has become an important part of Ottawa’s broader strategy to deepen economic engagement across the Indo-Pacific. Canada’s Indo-Pacific Strategy, launched in 2022, identifies trade, security, sustainability, people-to-people ties and regional engagement as key priorities.

For India, closer economic engagement with Canada could widen access to resources, technology, investment and international supply chains. The agreement could also provide a framework for businesses to explore partnerships beyond traditional trading relationships.

Can India and Canada meet the 2026 deadline?

The latest round of negotiations follows renewed efforts to strengthen economic ties during Canadian Prime Minister Mark Carney’s visit to India in March 2026. Sidhu has also held discussions with Union Commerce and Industry Minister Piyush Goyal on the sidelines of the G20 Trade Ministers’ Meeting in Milwaukee.

Canadian Foreign Minister Anita Anand’s visit to India from October 13 to 16 is expected to provide another opportunity to advance bilateral engagement, with trade, energy, security and defence among the issues on the agenda.

The challenge now is to translate the shared ambition into a commercially meaningful agreement. While the C$70 billion trade target sets a clear direction, the final outcome will depend on the concessions both sides are prepared to make and the pace at which outstanding issues are resolved.

For India and Canada, CEPA is more than a trade deal. It is an opportunity to turn renewed diplomatic engagement into a broader economic partnership. Whether the two countries can conclude negotiations by the end of 2026 will determine how quickly that ambition moves towards reality.