When Canada elected Mark Carney as Prime Minister on April 28, 2025, it marked not a partisan shift. His Liberal Party was already in power, but a big change in tone, leadership style, and foreign policy orientation. Carney’s victory, coming after a short stint at the top post following the resignation of Justin Trudeau, occurred during a period of serious diplomatic strain between Canada and India. The tensions that were triggered by longstanding strains over the Khalistan movement and exacerbated by high-profile incidents in 2023 and 2024.
As India continues to flag the Khalistan movement as a national security threat, the question of how Canada’s new leadership will approach this sensitive issue has gained urgency. While Carney inherits many of Trudeau’s domestic policies, his stance on foreign affairs, especially his more conciliatory gestures toward India, could help de-escalate one of the most visible and volatile international rifts involving Canada in recent years.
Trudeau’s overt association with designated terrorists known to threaten to bomb Indian aeroplanes and kill its diplomats, has irked Indians. Carney, in his short few months tenure, has taken an intensely different approach, despite belonging to the same party.
What Carney’s leadership may mean for the future of this contested issue?
Background: Canada and the Khalistan Movement
The Khalistan movement, which seeks to create a separate Sikh homeland carved from Indian territory, was most active in India during the 1980s and early 1990s. Although the movement lost steam within India due to strong state action and declining public support, it has continued to find sympathisers among sections of the Sikh diaspora, particularly in Canada, the United Kingdom, and Australia.
Canada is home to one of the largest Sikh populations outside India. According to the 2021 census, over 770,000 people identified as Sikh, making it the fastest-growing religion in the country. While the overwhelming majority of Canadian Sikhs are law-abiding and contribute meaningfully to Canadian society, a small but vocal and violent fringe has kept the idea of Khalistan alive through activism, referendums, and political lobbying.
India has long accused Canada of being soft on Khalistani elements and has submitted multiple diplomatic demarches regarding individuals and organisations operating from Canadian soil. For years, this tension simmered below the surface. However, it escalated dramatically in 2023 with the killing of Hardeep Singh Nijjar.
The Nijjar Assassination and Diplomatic Breakdown
On 18 June 2023, Hardeep Singh Nijjar, a prominent Khalistan advocate and president of the Guru Nanak Sikh Gurdwara in Surrey, British Columbia, was shot dead outside the temple. Nijjar had been designated a terrorist by the Indian government in 2020 for his alleged involvement in violent separatist activity. He was also linked to the banned group Sikhs for Justice (SFJ), which had organised referendums on Khalistan across Canada.
The case took a more serious diplomatic turn in September 2023 when Prime Minister Justin Trudeau stood in the House of Commons and claimed that Canadian intelligence agencies were investigating “credible allegations” of Indian government involvement in Nijjar’s killing. India rejected the accusation outright, calling it “absurd and motivated,” and responded by suspending visa services for Canadian citizens and expelling a senior Canadian diplomat.
Canada followed suit by expelling an Indian official, and relations continued to spiral. In October 2023, Canada was forced to recall 41 diplomats from India after New Delhi threatened to withdraw their immunity. Dialogue between the two countries broke down almost entirely. Trudeau, who had previously been criticised by Indian authorities for appearing at events with Khalistan-linked individuals, became a lightning rod for criticism in Indian media and policymaking circles.
The Arrests That Changed the Tone
In May 2024, a major breakthrough occurred when the Royal Canadian Mounted Police arrested three Indian nationals, Kamalpreet Singh, Karanpreet Singh, and Karan Brar, in Edmonton in connection with Nijjar’s killing. A fourth suspect, Amandeep Singh, was later charged. All four were charged with first-degree murder and conspiracy.
The arrests were significant not only for the domestic legal case but also because of a leaked U.S. intelligence report suggesting that elements within India’s intelligence services may have authorised the plot. This added a layer of international scrutiny. The United States and other Western nations called for accountability, even as India continued to deny state involvement.
The episode placed Canada in a difficult position. On the one hand, the Canadian government had to defend its sovereignty and the rule of law. On the other, it risked further alienating India, a strategic partner in trade, migration, and Indo-Pacific security.
Carney’s Rise and a Potential Policy Reset
Mark Carney’s election came amid this tense backdrop. A former Governor of the Bank of Canada and the Bank of England, Carney brought a reputation for fiscal prudence, diplomatic restraint, and technocratic leadership. His decision to run for the Liberal leadership in early 2025 followed months of speculation about Trudeau’s weakening political standing.
Unlike Trudeau, Carney had no personal political baggage related to India. In fact, in the weeks leading up to the election, Carney made a number of gestures that were interpreted as efforts to rebuild trust. He visited a prominent Hindu temple in Toronto during Diwali celebrations and made a point of expressing appreciation for Canada’s Indian community without directly referencing Khalistan. These symbolic overtures, while subtle, were welcomed in Indian diplomatic circles.
Carney’s public statements during the campaign included references to the importance of “stable and respectful partnerships” with democracies like India. He emphasised that while Canada would continue to uphold civil liberties and the right to peaceful assembly, it would not tolerate foreign interference or the glorification of political violence—an apparent shift from Trudeau’s more hands-off approach.
What Changes Under Carney?
While Carney is unlikely to deviate drastically from Canada’s core legal rhetoric to free speech and assembly for the Khalistani terrorists; there are several ways his government may handle the Khalistan issue differently from Trudeau’s administration:
- Quieter Diplomacy: Carney is more inclined toward behind-the-scenes diplomacy than public confrontation. This could mean a reduction in highly visible rhetorical battles and an increase in backchannel negotiations with Indian counterparts.
- More Proactive Law Enforcement: The arrests in the Nijjar case set a precedent. Carney’s government may be more willing to act on credible intelligence about foreign-linked plots or criminal activity among separatist networks, especially if such action is framed as protecting Canada’s sovereignty.
- Balancing Civil Liberties and Extremism: One of the key challenges for Carney will be navigating the line between protecting freedom of expression and countering hate speech or incitement. His administration could introduce new legal or procedural measures to ensure that violent extremism is not allowed to flourish under the cover of free speech.
- Restoring Diplomatic Channels: Early signs suggest that Carney is interested in restoring full diplomatic relations with India. Reports indicate that Indian officials have responded positively to initial overtures from Carney’s team, though concrete developments are still pending.
- Diaspora Engagement: Carney’s government may invest more in structured engagement with Canada’s Indian diaspora, creating forums where concerns can be aired constructively, possibly reducing the influence of fringe separatist voices.
Risks and Limitations
Despite these opportunities, Carney’s scope for manoeuvre remains limited by Canada’s legal and political framework. The Khalistan issue is deeply emotional for both Indian officials and a segment of the Sikh community in Canada. Any perception of the Canadian government cracking down on Sikh activism could provoke domestic backlash. Conversely, doing too little could jeopardise efforts to rebuild ties with India.
Carney will also face pressure from the United States, the United Kingdom, and other allies who are themselves balancing relationships with India while safeguarding diaspora rights. His ability to chart an independent course will depend in part on his political capital at home and his willingness to make trade-offs.
A Turning Point or Just a Pause?
Whether Carney’s election will truly shift the dynamics around the Khalistan issue depends on both the Canadian and Indian governments showing a willingness to cooperate. For India, a less confrontational Canadian administration offers a chance to reset relations without appearing to have conceded on core concerns. For Canada, it is an opportunity to reassert its sovereign decision-making while avoiding unnecessary diplomatic isolation.
Early steps like restoring full diplomatic staffing, reopening stalled trade negotiations, and reaffirming joint commitments on education, migration, and counterterrorism, will be key indicators of intent. But the deeper challenge of balancing democratic values with national security concerns will persist.
