Ottawa and New Delhi forge strategic energy alliance

Investing.com -- Ottawa and New Delhi have formalized a significant energy partnership, marking a major recalibration of bilateral ties. Energy Ministers Timothy Hodgson and Hardeep Singh Puri issued a joint statement Tuesday from Goa, outlining plans for Canada to export crude oil and liquefied natural gas (LNG) in exchange for Indian refined petroleum products.

The agreement followed the first high-level participation of Canada at India Energy Week, effectively launching the renewed talks. Both leaders emphasized that "energy security and diversity of supply" are fundamental to the "safety, wellbeing, and economic vitality of both countries" as they navigate a volatile global landscape.

This diplomatic pivot follows a June 2025 directive from Prime Ministers Mark Carney and Narendra Modi, who met on the sidelines of the G7 Summit in Kananaskis. The leaders then underscored "the importance of restarting senior ministerial, as well as working-level engagements" to mend a fractured relationship.

Canada is hoping to position itself as an energy superpower with a mandate to diversify exports beyond the United States. Utilizing the Trans Mountain Expansion (TMX) Pipeline and West Coast terminals, Ottawa aims to tap into an Indian market projected to account for one-third of global energy demand growth over two decades.

Canada’s new trade strategy under Carney has already led to a landmark agreement with China, announced last week, which traded reduced tariffs on Chinese electric vehicles for lower duties on Canadian canola. The prime minister has defended these moves as necessary risk management, following a speech at the World Economic Forum in Davos calling on middle powers to ally in combating economic hegemony.

However, these pivots have sparked a sharp backlash from Washington, with President Donald Trump threatening 100% tariffs on Canadian goods if the trade deal with China is struck. Despite the friction, Ottawa seems steadfast in its commitment to diversifying trade.

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