Economy

Canadian exports are no threat to the Indian economy, says Canadian High Commissioner Cameron Mackay

Amiti Sen | | Updated on: Jun 23, 2022

‘We have always found a way to conclude free trade deals taking into account sensitivities’

India and Canada recently concluded the second round of the negotiations for a bilateral Free Trade Agreement (FTA). The stage is now set for a third round in July and August with a fourth one possibly in September, says Canadian High Commissioner to India Cameron Mackay. In an interview with BusinessLine, Mackay talks about Canada’s expectations from the deal and why the proposed early harvest pact was likely to be much more ambitious than the one signed by India with Australia. Excerpts: 

India-Canada FTA negotiations seem to be picking up speed. Where do talks stand now and are you satisfied with the pace? 

We have had two rounds of negotiations so far. A third round is being scheduled which will be a  hybrid round. It will be held both virtually and in-person in Ottawa. A part of it would be held in July and another part in August. In addition, we are having monthly telephone calls between our Trade Ministers to show political will and basically to push the negotiators to keep working faster.

We have made progress. There is a better understanding of the ambitions and sensitivities of the other side. I think both sides would now want to move even faster. The third round will be an important one to demonstrate even more progress. We are hoping to do the fourth round in September. But the logistics for that has not been finalised yet.

Is there an end date in mind for the ‘Early Progress Trade Agreement,’ that is supposed to lead to the full fledged Comprehensive Economic Partnership Agreement?

I think the Ministers have talked about getting a deal done this year. Frankly, we are still in the early stages of the negotiations. And we still have to make substantial, concrete progress. And then we will have a better idea of when a deal can really be concluded.

The early harvest deal concluded between India and Australia recently is mostly about goods. When you are looking at an Early Progress Trade Agreement with India, would you want it to be more diverse?

It is important to keep in mind that Canada’s economy is considerably larger than Australia’s. Our export profile of goods and services and our investment profile to India is considerably broader and more diversified. So, we are looking for a more comprehensive and ambitious agreement as reflective of the relationship we have with India and the breadth of the Canadian economy.

There is a concern that an FTA with a developed economy like Canada could pose a threat to the Indian industry. What do you say to that?

Canada’s export of manufactured goods to India represented 0.23 per cent of India’s total manufacturing production in 2020. This, I believe, makes it clear that increased Canadian exports to India are no threat to the Indian economy. They can only help to support `Make in India’ and build self-reliant India. Canada wants to contribute to that. 

Canada’s record is that every trade negotiation that we concluded with partners, has benefited both. Mutually beneficial deals is what we have always negotiated and what we are hoping to get with India. So, I am optimistic that if we can get the deal done, it will lead to more prosperity in India and Canada.

Dairy is a sensitive sector in India, as it is in Canada, and was excluded from the pact with Australia. Would it be possible to include at least some dairy items in the India-Canada trade deal?

Dairy has been dealt with in very special ways in all our previous trade agreements (with other nations). Likewise for India. The details are to be left for the negotiators. But we have always found a way to move forward and conclude deals taking into account the greatest sensitivities on both sides.

How important are financial services for Canada?

It is a very important and growing sector for us. We are hoping that it is the same for India as well. Canada’s approach is to say, let’s negotiate in every area. We are prepared to include everything.

Would Canada want to cover investment protection in the overall CEPA or would it want a standalone agreement? 

All of Canada’s major trade agreements include investor protection in some way or the other, be it NAFTA or the Canada-European Union Comprehensive Economic and Trade Agreement (CETA) and the Comprehensive and Progressive Agreement for Trans-Pacific Partnership. Our normal practice is to put it all together in the treaty. That’s what we are discussing with India. And we understand as well that India comes from a different perspective.

How liberal will Canada be while discussing visa-related issues as part of the CEPA with India?

Visas are not part of the negotiations but temporary entry of  professional and skilled worker could be. That’s something negotiators are discussing. The Canada-India people to people relationship is already enormous. Canada has an open policy towards movement of people. That is important to take into account. India is the largest supplier of people to Canada in most categories be it business visas, student visas, temporary entry or tourist visas or permanent resident visas.

Right now, lakhs of visa applications from Indians wanting to visit Canada are pending. What is being done to ease the backlog?

The Canadian government is committed to dealing with the large inventory of outstanding visa applications globally including in India. It is a wicked problem but we are absolutely committed to getting through it. It is going to take us several more months to clear the backlog that was built up through Covid and through a post-Covid surge in travel and mobility of people. The Canadian government has said publicly that it would like to get the backlog out of the way by end of the calendar year. It can be done through a combination of people, financial resources that the government has committed, efficiency and time.

Published on June 23, 2022
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