Modi’s likely visit to Canada in December adds urgency to free trade talks
India and Canada are set to hold the fifth round of negotiations for a Comprehensive Economic Partnership Agreement (CEPA), with a possible prime-ministerial-level visit later in the year expected to add momentum to the talks.
Four rounds of CEPA negotiations have already been completed, covering trade in goods, services, intellectual property, rules of origin, sanitary and phytosanitary (SPS) measures, and technical barriers to trade.
Sticking points flagged for the coming round include agricultural market access, movement of professionals (visas), and non-tariff barriers.
Both sides have set a target of concluding the agreement by the end of 2026, with an ambition to raise bilateral trade toward USD 50 billion by 2030.
CEPA vs FTA vs EPTA: Depth of Trade Agreements
A Comprehensive Economic Partnership Agreement (CEPA) is a deeper form of trade agreement than a standard Free Trade Agreement (FTA), typically covering not just tariff elimination on goods but also trade in services, investment protection, intellectual property, government procurement, and regulatory cooperation. An Early Progress Trade Agreement (EPTA) or Early Harvest Scheme is a narrower, interim agreement covering only a limited set of tariff lines, meant to build momentum before a full CEPA is concluded.
Key Details
- India and Canada had relaunched talks in March 2022 for an interim EPTA, holding more than six rounds before talks were paused.
- Negotiations were paused in September 2023 following a diplomatic rift after Canada alleged a possible Indian link to the killing of a Khalistani activist on Canadian soil — talks did not resume until ties were reset via a leaders' meeting at the G7 Summit.
- The current negotiation track has moved directly to a full CEPA rather than restarting the narrower EPTA.
The urgency around the fifth round reflects an effort to convert a reset in political relations into a concluded, comprehensive trade agreement before the 2026 year-end target.
Mode 4 Trade in Services: Movement of Natural Persons
Under the WTO's General Agreement on Trade in Services (GATS), "Mode 4" refers to the temporary movement of natural persons (professionals, service suppliers) across borders to supply a service — commonly negotiated in FTAs/CEPAs as visa and work-permit facilitation for skilled workers. Visa-related provisions in bilateral trade talks (as flagged in the India-Canada round) usually concern Mode 4 commitments and mutual recognition of professional qualifications.
Key Details
- GATS identifies four modes of trade in services: cross-border supply (Mode 1), consumption abroad (Mode 2), commercial presence (Mode 3), and movement of natural persons (Mode 4).
- India has consistently sought stronger Mode 4 commitments in its trade negotiations with developed economies, given its large skilled-services workforce.
- Canada hosts a large Indian-origin population and over 4 lakh Indian students, making people-mobility provisions politically and economically significant in the talks.
Visa facilitation being cited as a "tricky issue" in the CEPA talks is a direct real-world instance of Mode 4 negotiation friction under the GATS framework.
India's CEPA Portfolio: Comparative Context
India has concluded several CEPA/ECTA-type agreements in recent years as part of a broader strategy of pursuing bilateral and plurilateral deals alongside stalled mega-regional talks. The India-UAE CEPA was signed on 18 February 2022 and entered into force on 1 May 2022, while the India-Australia Economic Cooperation and Trade Agreement (ECTA) was signed in December 2022 and came into force on 29 December 2022.
Key Details
- India-UAE CEPA was India's first comprehensive trade deal in a decade at the time and eliminated tariffs on over 90% of India's exports to the UAE.
- India-Australia ECTA phased down tariffs on the majority of traded goods and included commitments on services and mobility.
- The India-Canada CEPA, if concluded, would extend this pattern of India signing focused bilateral deals rather than relying solely on multilateral trade liberalization.
The India-Canada CEPA talks are best understood as part of a wider, deliberate Indian trade strategy of "plurilateral deal-making" rather than an isolated bilateral initiative.
- Four rounds of India-Canada CEPA talks completed as of September 2026; fifth round upcoming.
- Target: conclude CEPA negotiations by end of 2026; raise bilateral trade to USD 50 billion by 2030.
- EPTA talks were relaunched in March 2022 and paused in September 2023 amid a diplomatic row.
- India-UAE CEPA: signed 18 February 2022, in force 1 May 2022.
- India-Australia ECTA: signed and entered into force December 2022.