Canada and India have agreed to get talks moving for negotiating a free-trade agreement as the two countries seek to need each other in the light of opening up of the Indian nuclear industry after years of muted silence since India detonated an atomic bomb in the early 1970s.
After the bilateral meeting with Canada's minister for the Asia-Pacific Gateway, Stockwell Day on 18 January, minister of commerce and industry Kamal Nath announced that India and Canada have agreed to initiate exploratory discussion towards a "comprehensive economic partnership agreement."
Kamal Nath said, ''We are committed to taking our economic partnership to the next level. The steps taken today will ensure we move towards opening doors for our respective business communities.''
Day said, ''Our discussion here responds to the recommendations made by the Canada- India CEO Roundtable.''
At a bilateral meeting held this week, while acknowledging the substantial growth in bilateral trade, the ministers stressed the need to further tap the huge investment potential that exists between the two countries, especially in the areas of infrastructure, agriculture and related activities and industrial goods.
Canada will have to keep out a range of farm products from the free trade agreement as India will not accept most of the farm trades as it will protect its farmers as witnessed in the failure of the Doha round of free trade held in Geneva last year.
The current trade between Canada and India was a mere $3-billion in 2007, an amount that Canada and China trade in three weeks. Most of Canada's exports to India are forest, agricultural products and minerals.
Both the ministers acknowledged the progress made on the Canada-India Foreign Investment Promotion and Protection Agreement (FIPA) and emphasised the need for an early implementation of the Agreement.
Kamal Nath also stressed the need for a particular focus on facilitating greater engagement between small and medium enterprises of the two countries.
Executives from Canada's nuclear and uranium industries are part of Day's contingent who are visiting India in search of nuclear contracts, with India needing nearly 25 reactors to meet its demands for power.
Canadian being a major producer of uranium, may start supplying India with the yellow cake after it the signing of the Indo-US nuclear treaty, which lifted all embargo on nuclear supplies to India.
Canadian atomic energy firm, Cameco Corp and SNC-Lavalin are keen to have joint ventures with Indian companies to build nuclear reactors and supply uranium.