India and Canada are exploring deeper energy cooperation alongside efforts to conclude a Comprehensive Economic Partnership Agreement (CEPA) before the end of 2026. The proposed partnership could establish a two-way energy supply chain under which India imports Canadian crude oil and natural gas while supplying refined petroleum products to Canada. The discussions come as both countries seek to strengthen economic ties following a series of high-level diplomatic and trade engagements.
A Canadian negotiating team is expected to visit New Delhi early in November for the sixth round of CEPA negotiations. Officials from both countries are working to resolve the remaining issues and finalise the agreement ahead of Prime Minister Narendra Modi’s scheduled visit to Canada on December 11 and 12. People familiar with the discussions said most key issues related to the proposed trade agreement had been resolved, although negotiations are continuing.
The proposed energy partnership could cover crude oil, liquefied petroleum gas, liquefied natural gas, potash, uranium and refined petroleum products. Canada is a major global producer of oil and natural gas, while India is one of the world’s largest consumers of crude oil. India’s extensive refining capacity could help meet Canadian demand for processed fuels, creating opportunities for trade in both directions.
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Canadian oil sands, particularly those in Alberta, contain substantial petroleum resources. However, some Canadian refineries face technical limitations in processing the heavy, bituminous crude extracted from these deposits. Several Indian refineries can process different grades of crude oil, potentially allowing India to import Canadian supplies and export refined fuels and other petroleum products in return.
Bilateral relations have gained momentum following meetings between Modi and Canadian Prime Minister Mark Carney at international summits, Carney’s visit to India earlier this year and subsequent trade delegations. In May, Commerce and Industry Minister Piyush Goyal led an Indian trade mission to Canada involving representatives from more than 100 companies. Canadian Foreign Minister Anita Anand and Trade Minister Maninder Sidhu also visited India in October, with Sidhu accompanied by a delegation of around 300 business representatives.
The two countries aim to increase bilateral trade in goods and services to 70 billion Canadian dollars by 2030. Their total trade reached 30.4 billion Canadian dollars in 2025, including 13.6 billion Canadian dollars in merchandise trade. If concluded, the CEPA could expand market access and strengthen cooperation across energy, technology and other strategic sectors, although the final outcome will depend on the completion of negotiations and formal agreement between both governments.
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