I'm Ken Macartney, the director general for South and Southeast Asia and Oceania.
It is my pleasure to be here today to speak to the committee on the topic of India. I am joined today by my colleague Don Stephenson, Chief Negotiator for the Canada-India comprehensive economic partnership agreement.
This afternoon, I propose to provide to you a general overview of Canada-India bilateral relations as well as share with you our plan for the coming months with regard to several initiatives currently underway. I would be pleased to answer any of your questions following the presentation.
Don Stephenson will answer questions specific to the Canada–India comprehensive economic partnership agreement.
Just a word about bilateral relations.... Canada–India relations continue to grow deeper and stronger. Committee members may be aware that 2011 is the Year of India in Canada, an initiative of the Indian government. This year-long series of events has successfully raised awareness in Canada of India's rich cultural heritage and its bright future. We too have engaged in many advocacy efforts in India.
This summer Toronto hosted both the International Indian Film Academy Awards and a major diaspora event, the Pravasi Bharatiya Divas, or the Day of Overseas Indians, which showcased Canada to many Indians.
Engagement is also increasing in the realms of science, technology, research, and academic exchange. In addition to the bilateral science and technology agreement already in place, budget 2011 provides $12 million over five years for a Canada–India Research Centre of Excellence.
The past year has witnessed reciprocal visits by dozens of university and college leaders from both countries. The number of Indian students to Canada surged last year to record numbers. All of this bodes well for much-expanded bilateral cooperation in the knowledge economy. Official consultations and agreements provide an expanding framework for relations.
On the commercial side, we’ve had regular, expert-level dialogue through annual trade policy consultations. Last fall we had the first of what is intended to be an annual ministerial dialogue on trade and investment. This event provides a platform to further advance our trade relationship and will help us reach our goal of tripling trade by 2015.
We're working to conclude the foreign investment promotion and protection agreement, and we're finalizing the last details of the Canada–India social security agreement.
Canada and India have signed a nuclear cooperation agreement that will allow for Canadian companies to participate in commercial civil nuclear power opportunities. We look forward to the conclusion of the administrative arrangement that will allow our nuclear cooperation agreement to be fully implemented.
We are beginning to cooperate more intensively on energy issues. Canada can share expertise in areas such as hydroelectric power and clean coal technologies, and learn from India in areas where it is a world leader, such as in wind and solar power technology.
As you know, India is a priority market for Canadian commercial engagement. Its rapidly growing economy, with growth rates maintained at 6% to 7% and in fact 8% even through the global economic crisis, is predicted to be the world's fourth-largest by 2025 and the third-largest by 2050. India is expected to become the world's most populous nation by 2050, and its growing middle class, estimated at between 150 million and 250 million, is estimated as a $400 billion market.
Canadian workers and businesses have yet to seize the full potential that the Indian market has to offer. Two-way merchandise trade reached $4.2 billion in 2010. India is our 13th-largest destination for merchandise exports, and our 19th-largest source of imports. Our goal, as mentioned, is to reach $15 billion in two-way trade by 2015.
Most encouraging is the two-way flow of foreign direct investment between Canada and India. In 2010 two-way direct investment reached a record level of $7 billion, the majority being Indian investments into Canada.
The Canada-India commercial relationship is not limited to traditional trade and investment only, as India is becoming an integral part of the global supply chains. Canadian companies such as Bombardier, Sun Life, and SNC-Lavalin have a long history of partnership in India, while Indian companies such as Essar, Tata, and Birla are equally active in the Canadian market. Our goal is to triple the number of companies that are active in India over the next three years.
Prime Minister Stephen Harper and Prime Minister Manmohan Singh of India announced the launch of comprehensive economic partnership negotiations during the G-20 summit in Seoul on November 12, 2010. Following the launch, negotiating rounds were held in November and July. The negotiations with India are a high priority, and we will seek to complete negotiations in 2013, as indicated in the 2011 Speech from the Throne. The committee will be interested to hear that a recent joint study estimated that a free trade agreement between the two countries has the potential to boost Canada's economy by $6 billion to $15 billion, creating jobs and prosperity for Canadian workers and for businesses of all sizes in every corner of the country.
On September 23, the Minister of International Trade, Ed Fast, held his first face-to-face meeting with Anand Sharma, India's Minister of Commerce and Industry, in New York City.
Both ministers conveyed their shared commitment to continuing to broaden and deepen our economic and social ties, and agreed the next round of negotiations aimed at producing a comprehensive economic partnership agreement between Canada and India should take place in October in Canada.
At the conclusion of their meeting, Minister Fast, on behalf of the Government of Canada, personally invited Minister Sharma to visit Canada again at his earliest convenience to personally continue their productive dialogue and progress. Minister Fast also committed to personally visiting India for the same purpose in the near future.
To conclude, Canada is well positioned to partner with a growing India. We share democratic traditions and legal frameworks, our growing official ties are bolstered by significant people-to-people links and regular high-level interaction, and companies in both countries are becoming more aware of the opportunities for trade and investment, facilitated by a network of trade commissioners in eight Canadian missions throughout India.
If I could, I'd like to take a moment to thank Mr. Keddy for opening our trade office in Calcutta a couple of years ago. It was much appreciated.
I'd be pleased to answer questions that you might have on Canada's trading relationships with India, and of course Don Stephenson is also here to answer questions.