Canada and India last week agreed to begin negotiations on a “substantive and ambitious” comprehensive trade agreement that could be worth hundreds of millions of dollars to Canadian food exporters.
A joint study on the potential increase in trade from a “comprehensive economic partnership agreement” said Canada’s current export of $566 million worth of product, mainly lentils, could grow by an additional $239 million to $805 million.
And a promoter of increased agricultural trade said the potential for increasing sales to the country of 1.2 billion consumers is more than the report suggests.
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“Those numbers really just reflect what increases we could see in commodities that we already sell,” Kathleen Sullivan, executive director of the Canadian Agri-Food Trade Alliance, said Sept. 27. “I think it is an under-estimation of the real potential. I know both beef and hog sectors see some real potential there with more than one billion people.”
The decision to begin negotiations on a deal to reduce trade barriers was announced in Ottawa Sept. 24 by trade minister Peter Van Loan and Indian commerce and industry minister Anand Sharma.
“The ministers agreed that there is a significant potential for sustained growth in trade and investment flows between the two countries and reiterated their prime ministers’ commitment to increasing trade to $15 billion annually in the next five years,” said a statement issued after their Parliament Hill meeting.
It came little more than a week after India agreed to develop rules that will allow fumigation of Canadian lentil imports at Indian ports, a decision that Canadian exporters say is a major breakthrough that will reduce delays and sometimes rejection of Canadian shipments.
Two-way trade now is worth more than $5.4 billion and Canada ranks as India’s 30th largest trading partner.
“It appears that the India-Canada trade relationship is significantly under-traded,” said the report written by Canadian and Indian officials. “For example, total trade between India and Canada is three times smaller than the size of trade between India and Australia, even though the Canadian economy is about 50 percent larger than that of Australia.”
Although agriculture’s share of the expanding Indian economy is shrinking, it still represents 17.6 percent of the gross domestic product and employs more than half the Indian workforce.
By contrast, primary agriculture accounts for 2.2 percent of the Canadian GDP and 1.6 percent of the workforce, according to the report.
