Carney's burden: Trump, trade & new world order

With a mandate for economist Mark Carney in Canadian elections, it is time to reset the damaged ties between Ottawa and New Delhi

- Ajay Bisaria

Among Donald Trump's many unintended achievements during his first hundred days back in the Oval Office, one stands out north of the 49th parallel: He has given a leg up to Mark Carney, a political neophyte, to coast to a miraculous near-majority victory in the Canadian polls on Monday. The Liberals were trailing the Conservatives by 25 points in opinion polls in November thanks to former Prime Minister (PM) Justin Trudeau's unpopularity, but the emergence of an existential Trump challenge made Canadians turn to Carney as the caped saviour with the economic wand.

Carney, once governor of the Bank of Canada and later the Bank of England, now assumes leadership at a moment of rare peril and opportunity for Canada. America's renewed belligerence on trade under Trump—the re-imposition of steep tariffs on Canadian goods coupled with repeated threats to make it America's 51st state—leaves Ottawa little choice but to urgently diversify its economic and diplomatic partnerships. Europe will be a natural, if limited, hedge, and relations with China will remain challenging. But an early and vital opportunity lies elsewhere: India.

It is here that PM Carney must move quickly and with dexterity, to repair a relationship that, while commercially buoyant, has been politically frozen since 2023. The genesis of the freeze is well known. In September 2023, then-PM Trudeau accused India's government of involvement in the killing of a Canadian citizen and Khalistani separatist, Hardeep Singh Nijjar. The allegation ignited an unprecedented diplomatic firestorm—the suspension of trade talks, mutual expulsions of diplomats and the near-total collapse of bilateral engagement.