Slowing economic growth . . .
The state of the Indian economy in recent years has been lacklustre. Compared to the seven per cent growth recorded in July-to-September 2018, GDP growth for the same period in 2019 was 4.5 per cent, the weakest since 2013. According to the World Bank, India’s unemployment rate is on the rise, from 2.1 per cent in 2010 to 5.3 per cent in 2018, with the labour force participation rate dropping over this same period from 53 per cent to 48 per cent. Manmohan Singh, economist and former prime minister, attributes the economic slowdown to a “climate of fear,” commenting last November on how “many industrialists tell me that they live in fear of harassment by government authorities” as technology startups in particular “seem to live under a shadow of constant surveillance and deep suspicion.”
Complicated trade relations . . .
India’s trade relations with the U.S. and other countries in the Asia Pacific are in a precarious state. Last May, the U.S. stripped India of the special status that exempted the country’s products from tariffs. The Office of the United States Trade Representative said that the termination was in response to India’s failure to provide equitable and reasonable access to its markets. Just as its trading relations with the U.S. have fallen into turmoil, India pulled out of the Regional Comprehensive Economic Partnership (RCEP) negotiations last year. If signed, India would have formed a free trade bloc with 15 countries, including the 10 ASEAN members, as well as China, Japan, South Korea, Australia, and New Zealand. New Delhi said that it was concerned about the potential large influx of Chinese goods under the deal, but in a recent statement, India’s foreign minister indicated that the country would still be open to the deal if its interests are accommodated.
Growing Canada-India trade relations . . .
Canada-India trade relations, meanwhile, have been robust and continue to grow. In 2019, Canada exported C$4.7 billion worth of goods to India and imported C$5.5 billion from India. In the last five years, Canadian exports to the South Asian country have increased by 10.7 per cent and imports by 38.7 per cent. Despite the growing trade flows, roadblocks remain. For instance, David Marit, Saskatchewan’s minister of agriculture, has complained that the lack of consistency in India’s trade policy creates uncertainty for Canadian farmers.