There were fears that some Canadian firms that generate revenues from sales to India may see a drop in stock prices after Prime Minister Justin Trudeau on Sept. 18 accused the Indian government of involvement in the killing of a prominent Sikh leader in Surrey, B.C., in June. There was speculation that potash miners Nutrien Ltd. and The Mosaic Co., both members of Canpotex Ltd., might move down. Canpotex lists India among its five largest export markets.
While both stocks were off slightly on the New York Stock Exchange between Monday and Thursday’s close, neither company wanted to comment. A recent decision by the US Court of International Trade remanding phosphate countervailing duties back to the US International Trade Commission was another possible factor (See related story).
“Canadian potash is vital to India’s
food security and Canpotex has been a reliable supplier to India for 50 years,”
said Gordon McKenzie, Canpotex President and CEO last year when the
organization inked a new three-year contract with three Indian companies (GM
Sept. 30, 2022). “Canpotex is committed to supporting India’s potash needs as
their agriculture sector continues to grow, particularly in light of current
restrictions on Russia and Belarus.”
At the time, Canpotex signed Memorandums of Understanding (MOUs) with three of
its customers in India: Indian Potash Ltd., Coromandel International Ltd., and
Chambal Fertilisers and Chemicals Ltd. The MOUs confirmed Canpotex’s
willingness to supply, and each customer’s willingness to acquire, up to
500,000 mt of potash annually during the period from Jan.1, 2023, to Dec. 31,
2025.
India Potash Ltd. Managing Director P.S. Gahlaut told Reuters on Sept. 22 that his company does not expect any impact on potash imports from Canada. “Canpotex’s deal with Indian companies are commercial contracts,” Gahlaut said. “So far, it is business as usual for us.”
On Sept. 18, Prime Minister Justin Trudeau announced that Canadian investigators were “pursuing credible allegations of a potential link” between Indian agents and the shooting of Hardeep Singh Nijjar, 45, outside a temple in B.C. last June. Trudeau said he had raised the issue directly with Prime Minister Narendra Modi and called on India to cooperate in the investigation, emphasizing that “any involvement of a foreign government in the killing of a Canadian citizen on Canadian soil is an unacceptable violation of our sovereignty.”
The Indian foreign ministry has rejected the charges as “absurd and motivated.” It repeated calls for Canada to crack down on figures such as Nijjar, whom India had designated a terrorist bent on promoting the so-called Khalistan movement, which during the 1980s and early 1990s violently sought to carve out an independent Sikh state in India’s Punjab region. Several other Sikh activists have died overseas under suspicious circumstances in recent months.
Ties between the nations are at their lowest point in decades due to tensions over demands by some Sikhs in Canada – the largest population outside of India’s Punjab state – for an independent homeland. Both countries expelled senior diplomats from the other side.
Officials in New Delhi have long accused Canada of serving as a haven for Sikh separatists and doing little to protect Indian missions and consulates from protests carried out by these groups. On Sept. 20, New Delhi issued warnings for its citizens living and studying in Canada to exercise caution in areas where there are anti-India activities and “politically condoned hate crimes.”
The notice was shared widely on social media in India along with calls to boycott Canadian brands such as coffee chain Tim Hortons and frozen food manufacturer McCain Foods. Indian media has taken a nationalist tone in their coverage of the issue, questioning the veracity of Trudeau’s claims and asking why no evidence has yet to be released.
Prime Minister Narendra Modi, who has yet to address Trudeau’s accusations, is widely seen by analysts as benefitting politically from the diplomatic spat ahead of elections next year, when he’ll be vying for a third term in power. His party has pushed a Hindu nationalist agenda and the government takes a rigid position against secessionist Sikh groups, which tracks well with voters.
At the same time, Trudeau’s minority government is kept in power by the New Democratic Party, whose leader is Jaymeet Singh, a Sikh. There are some 1.4 million Canadians of Indian heritage, or 4% of the population, many of them Sikhs.
By Sept. 21 the situation had been exacerbated, with India suspending visa applications in Canada. The move meant Canadians would not be able to travel to India if they didn’t already have a visa, affecting both business and leisure travelers. Canadians made 280,000 tourist arrivals in India last year, according to Indian government data, making it the No. 5 source of such visitors.
Montreal-based engineering firm SNC-Lavalin Group Inc., which now operates under the brand name of AtkinsRealis, has limited travel to India for Canadian employees to “essential reasons only” until further notice, the firm told Bloomberg.