China beneficiary of India-Canada Diplomatic Face-off

The once-strong diplomatic ties between India and Canada, built on shared democratic values, trade, and mutual interests, have unraveled faster than anyone could have imagined. Allegations linking India to violence against Sikh separatists on Canadian soil have pushed their relationship into an unprecedented crisis. Nearly 2 million members of the Indian diaspora live in Canada, including 800,000 Sikhs. The dispute between the Indian and Canadian governments has escalated into conflicts between the Hindu and Sikh diaspora groups in Canada. This tense standoff, marked by tit-for-tat expulsions, heated rhetoric, and Canada placing India on its list of enemy countries, has implications that extend beyond bilateral relations and could reshape global geopolitics. As the rift deepens, China stands poised to capitalize on the chaos.

It all began with a bombshell: Canadian Prime Minister Justin Trudeau publicly accused Indian agents of involvement in the June 2023 killing of Hardeep Singh Nijjar, a Canadian citizen and prominent Sikh separatist leader, in Surrey, British Columbia. The disclosure triggered a diplomatic uproar, with both nations expelling top diplomats. Canadian authorities then revealed what they claimed was evidence of a broader campaign allegedly led by Indian intelligence, involving coercion and acts of violence against Sikh diaspora activists.

Amit Shah, India’s powerful Minister of Home Affairs and Prime Minister Narendra Modi’s closest aide, was named by a Canadian official as being at the center of this campaign. This accusation placed Shah—and by extension, the Indian government—squarely in the international spotlight. India firmly denied the allegations, calling them “absurd” and accusing Trudeau’s administration of political maneuvering as it faces domestic challenges ahead of the 2025 elections.

This crisis has highlighted a deepening trust deficit between India and Canada, which extends to their Western allies. By making these accusations public instead of pursuing quiet diplomacy, Canada broke protocol in a move some view as politically motivated. Trudeau’s popularity has been waning domestically, making his tough stance on foreign interference appear strategic.

Meanwhile, the United States and its Five Eyes allies, including the UK, Australia, and New Zealand, find themselves in a delicate position. Publicly, they have shown support for Canada’s investigation. Privately, they are cautious about jeopardizing strategic partnerships with India. India has been an essential ally in countering China’s influence in the Indo-Pacific, and any rift with New Delhi complicates these efforts, weakening the collective front needed for regional security.

The stakes for India are immense. Historically, it has positioned itself as a trusted partner to the West, emphasizing its role as the world’s largest democracy with significant geopolitical influence. India’s participation in forums like the Quad has reinforced its alignment with Western values. However, allegations of transnational repression could tarnish its reputation, making allies question its reliability.
While immediate trade repercussions may be limited, the rift could lead to increased cyber-espionage activities and delays in immigration processes, adversely affecting people-to-people connections. The situation complicates India’s geopolitical positioning, potentially impacting its aspirations as a rising power and its strengthening ties with Western allies, including the U.S., which has urged India’s cooperation in the investigation. Domestically, the government’s aggressive stance might bolster nationalist support, but internationally, it risks portraying India as resistant to accountability and collaboration.

China, observing the fallout, stands to gain. Strained relations between India and the West create opportunities for Beijing to strengthen its influence. The more India’s credibility falters, the easier it becomes for China to step in as a more stable alternative, drawing middle powers and neutral nations into its sphere. While Canada and China navigate familiar trade battles involving complaints to the World Trade Organization and accusations of dumping, the dispute with India touches more deeply on national security, sovereignty, and diplomatic credibility. These urgent issues could attract greater media attention, political focus, and policy responses compared to trade issues with China.
Within India, critics argue that Western nations—with their own history of extrajudicial actions and violations of international law—have limited standing to lecture on national security measures.

Conversely, Western critics highlight a double standard: democracies are quick to condemn authoritarian actions by countries like China and Russia but adopt a more measured approach when accusations involve an ally like India. This hesitancy contrasts sharply with the swift and unified response when Russia was implicated in the 2018 poisoning of ex-spy Sergei Skripal in the UK.
This inconsistency undermines the moral high ground that Western democracies often claim, reinforcing narratives promoted by China and other authoritarian regimes that Western outrage is selective and self-serving. For India, being perceived as a nation willing to engage in extraterritorial operations risks alienating its allies and eroding its credibility on the global stage.

For Trudeau, this crisis is a high-stakes gamble. His firm stance could resonate with voters who prioritize national security but comes with potential economic repercussions. India is Canada’s 10th largest trading partner, and Indian students contribute significantly to Canada’s economy. A prolonged dispute threatens these ties, impacting trade and the education sector.

Western allies, especially the Five Eyes, face the challenge of supporting Canada while maintaining strategic ties with India. The U.S. has shown a preference for diplomatic engagement with India on similar issues, as seen in its handling of allegations involving an Indian agent in a New York-based plot. This contrasts with Canada’s public approach and exposes differing strategies within the Western alliance.
Rebuilding trust will require a careful, strategic approach. India must demonstrate transparency and engage in constructive dialogue with Canada and its Western allies. Acknowledging legitimate concerns while protecting national interests can pave the way for diplomatic resolutions that prevent further isolation. For Canada, addressing security threats without alienating a key partner like India is crucial.
This crisis serves as a reminder of the complexities of maintaining alliances when national interests collide with democratic values. It underscores the need for a cohesive Western strategy that addresses breaches of international norms, regardless of the country involved. Failure to do so could embolden China, exploiting fractures to gain strategic leverage.

As the world watches how India and Canada navigate this diplomatic storm, the outcomes will not only redefine their bilateral relationship but could also shift alliances and power dynamics on the global stage. In this game of credibility and strategic interests, China is poised to be the quiet winner.

Ashok Swain is a professor of peace and conflict research at Uppsala University, Sweden.

(Photo Credit: Canadian PM Justin Trudeau and Indian PM Narendra Modi at their meeting on the sidelines of the G20 summit in Delhi. Photo: Twitter/Justin Trudeau)