India and Canada have agreed to significantly advance their bilateral relationship with the signing of a historic nuclear energy agreement, as well as framework agreements to increase trade between them and cooperation in security. The partnership formalized upon Canadian Prime Minister Mark Carney and Indian Prime Minister Narendra Modi met in New Delhi on Monday.
The key element of the deal is a $2.6 billion agreement to supply uranium for India’s nuclear energy program, which is expected to expand significantly, and includes a uranium supply agreement for the long term and cooperation in the development of small modular reactors and other advanced nuclear technologies designed to aid India in developing additional sources of clean energy and subsequently moving away from its current dependence on fossil fuels.
Modi called the uranium supply agreement a “landmark deal”, adding that the two countries would also work more closely together on projects involving artificial intelligence, semiconductors, critical minerals and renewable energy.
Trade deal push and $50 billion target
In addition to the nuclear energy agreement, the two sides agreed to accelerate their work on negotiations for a Comprehensive Economic Partnership Agreement (CEPA), with an end goal of having it completed by the end of 2026.
At this time, bilateral trade between the two countries is approximately $9 billion, but both countries hope to increase this amount to at least $50 billion by 2030.
Canada is ideally situated to meet India’s growing energy needs according to Carney, and he announced today the beginning of a larger strategic energy partnership. This agreement is also seen as part of the joint efforts of both countries to diversify their trading partners due to uncertainty about global tariffs, and to limit their reliance on traditional partners, such as the United States.
Reboot after diplomatic crisis
Bilateral relations had declined significantly in 2023, when ex-Canadian PM Justin Trudeau accused India of being involved with Hardeep Singh Nijjar’s murder, for which India adamantly denied any involvement, terming the allegations “ludicrous”.
Diplomatic expulsions, visa service suspensions, and cessation of trade talks were all caused by the dispute between the two nations.
Taking a cautious approach to restore relations since Carney took office in 2025, this visit by Carney to India is the first major diplomatic contact between the nations in many years.
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Strategic shift driven by geopolitics and energy needs
India is looking for dependable sources of uranium and creating new trade opportunities to facilitate its economic development and transition to renewable energy. Canada, which is among the world’s largest uranium suppliers, considers India to be an important long-term partner.
Both leaders expressed their common beliefs in being a democracy, their strong human connections, and cooperating on future projects.
Carney stated that the recent re-engagement is on a historical scale, with more interaction in 12 months than in the last 20 years put together.
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