India and Canada Set Stage for Enhanced Economic Partnership by 2026 CEPA Deadline

India and Canada Strengthen Economic Ties, Pledge to Conclude CEPA Deal by 2026-End

In a significant move to boost bilateral economic cooperation, India and Canada have reaffirmed their commitment to strengthen their economic and financial ties. The two countries have agreed to conclude negotiations on a Comprehensive Economic Partnership Agreement (CEPA) by the end of 2026 and initiate talks on a Bilateral Investment Treaty (BIT) at the earliest.

The agreement was reached during the inaugural Economic and Financial Dialogue held in Toronto, where Finance Minister Nirmala Sitharaman and Canada's Minister of Finance and National Revenue, Francois-Philippe Champagne, exchanged views on global macroeconomic developments and domestic policy priorities. The dialogue aimed to support financial and commercial linkages between the two countries and advance their shared goal of expanding bilateral trade to CAD 70 billion by 2030.

The two sides welcomed opportunities to broaden the use of India's Unified Payments Interface (UPI) in Canada, recognizing its potential to contribute to faster and more cost-effective payments. They also agreed to support engagement between relevant authorities and stakeholders to explore opportunities related to cross-border remittances and merchant payments.

India expressed its readiness to initiate negotiations on a BIT at the earliest, and the ministers welcomed the growing investment relationship between the two countries. They noted the substantial presence of Canadian pension funds and other institutional investors in India and discussed ways to facilitate greater engagement between Indian and Canadian financial institutions and institutional investors.

The two countries also explored opportunities for cooperation in payments modernisation, financial stability, fintech innovation, capital market development, and efforts to address financial crime. On global economic and financial issues, the ministers agreed to explore greater cooperation in areas of shared interest, including critical minerals, with a focus on building resilient and diversified supply chains.

The dialogue was a significant step forward in strengthening bilateral economic ties between India and Canada. The two countries have a long history of cooperation, and this agreement is expected to boost trade and investment between them. The next India-Canada Economic and Financial Dialogue is scheduled to be held in 2027.

Key Areas of Cooperation

• Comprehensive Economic Partnership Agreement (CEPA): India and Canada have agreed to conclude negotiations on a CEPA by the end of 2026.
• Bilateral Investment Treaty (BIT): India has expressed its readiness to initiate negotiations on a BIT at the earliest.
• Use of UPI in Canada: The two sides have welcomed opportunities to broaden the use of UPI in Canada, recognizing its potential to contribute to faster and more cost-effective payments.
• Cross-border remittances and merchant payments: The two countries have agreed to support engagement between relevant authorities and stakeholders to explore opportunities related to cross-border remittances and merchant payments.
• Investment relationship: India and Canada have welcomed the growing investment relationship between the two countries, with a focus on facilitating greater engagement between Indian and Canadian financial institutions and institutional investors.