International Trade Committee on Nov. 1st, 2017

[Kanwar Dhanjal]

In terms of youth and SMEs, in our chamber we have different committees. We have a committee called YE, young entrepreneur, and WE, women entrepreneur. We have a special focus on youth and women, mainly for the small business sectors.

In India, SMEs are the backbone of the Indian economy. It's the same thing here. I myself am an entrepreneur. I have a small company and we are contributing to the Canadian economy.

Really, our focus is on youth and women. At the ICCC, every year we take a business delegation to India in January. It varies, but between 50 and 120 businesses go with us to India. In January 2018, we are taking a delegation to India. It will be a multi-sector and multi-city delegation.

Last year when we took a delegation to India, honourable Minister Sohi was part of the mission. Before that, Jason Kenney was part of our delegation. There is a lot of federal participation in the India mission.

I feel that the SME sector, which as I said is the backbone of India's economy, and here, if we connect B to B, small business to small business, it can really give a boost both to companies situated in Canada and to companies situated in India. We really want to have more focus towards SMEs to increase trade and small manufacturing, because in India, manufacturing is very cheap.

I'll show you a very positive example, if you can give me two more minutes. There was a time 10 years ago when a lot of companies in the U.S. and Canada moved to India for telemarketing. Over time there have been a lot of inquiries from Canada from people looking for engineering services, to be offered from India, to make your drawings, to make your designs. They need these people from India.

One more important thing came to me recently. A company situated in Canada is supplying globally, especially to the Middle East, Asian countries, or [Inaudible—Editor] countries. They are looking for engineers, hired from India, to be stationed in India, to give the services to that area. Sending engineers from Canada to Asian countries, or to India, or to the Middle East is expensive. If they hire someone from India, they can [Inaudible—Editor] the Middle East, an Asian country, or [Inaudible—Editor] countries. There are new technologies coming up now. These are things we see in the SME sector and these are adding things to increase the SME trade.

Thank you, Tracey.

[The Chair, Liberal, Mark Eyking]

Thank you, sir.

Ms. Ramsey, that is your time.

We're going to move over to Mr. Dhaliwal, for five minutes.

[Sukh Dhaliwal, Liberal, Surrey—Newton, BC]

Thank you, Mr. Chair, and thank you to the presenters.

Mr. Potoczny, in my previous terms, I had interns as well from Ukraine and they were very helpful.

My question is for the ICCC.

Mr. Dhanjal, you mentioned CEPA. The last time we had a round of negotiations was in 2015. Would you tell the committee what would be the benefits to both nations, India and Canada, of signing CEPA?

[Kanwar Dhanjal]

With CEPA, the trust between the companies, the trust between the governments, and the trust between the SME sectors will increase. At the same time, taxation and import duties will be reduced. It's like a free trade agreement. When there is a free trade agreement, there is no taxation, no import duties, or no export duty there. It definitely bolsters that. CEPA is really going to make a big contribution towards a multifold increase in trade between the two countries. I wish and I pray that this should happen as soon as possible.

[Sukh Dhaliwal, Liberal, Surrey—Newton, BC]

On the other side, you recommended that it should be a business-to-business relationship. India is a very vast country, as is Canada, if you look at various regions, various provinces. That might not be a possibility, but the agreements between the governments are key.

What recommendations would you make to strengthen and/or improve relationships with India so that, instead of going business to business, we are going from government to government and the governments are playing the key role?

[Kanwar Dhanjal]

CEPA is not government to government. When the CEPA is signed, in all the provinces and all the states in India that are doing exports, it is not a provincial rule. It is going to be a federal government rule. There is no taxation. When there is no taxation, whether somebody is sitting in the north or middle or western or eastern part, it's the same rule: no taxation. Definitely, then, this will get a boost.

I'll tell you what is happening. Let's look at canola oil. Canola oil is going to India. There's a huge demand.

[Sukh Dhaliwal, Liberal, Surrey—Newton, BC]

What about pulses?

[Kanwar Dhanjal]

In India, the import duty is 26%, which is very high. If a free trade agreement like CEPA is signed, the import of canola oil from Canada to India will have a multifold boost.

There's one more thing I would like to tell you. India has a huge industrial base. In Asian countries, India is a leading partner of all Asian countries. After China, it's India. India can supply that canola oil to different parts of neighbouring countries, whether it's Pakistan, Bangladesh, Sri Lanka, or Thailand. The important thing, again, is that CEPA needs to be signed.

Thank you, sir.

[Sukh Dhaliwal, Liberal, Surrey—Newton, BC]

You have heard about FIPA, the foreign investment promotion and protection agreement. What are your views on it, and how is it going to benefit both nations? Can you elaborate on that?

[Kanwar Dhanjal]

As I said, the Canada pension plan made a small investment in India, and it was a small investment because the FIPA has not been signed. There is no protection of foreigners within your protection act right now. Once the FIPA is signed, the Canada pension plan and other agencies can invest in India, because India's is a growing economy, more than 7%. This is second to none.

The economy is growing. At the same time, whatever investment a Canadian company is investing in India will grow automatically.

It's very important to sign the FIPA.

[Sukh Dhaliwal, Liberal, Surrey—Newton, BC]

Have you made that pitch to the Indian government?

[The Chair, Liberal, Mark Eyking]

Mr. Dhaliwal, nice try. You almost got in there. The Liberals are going to have some time later on. If you want to punt this question to another colleague, that's fine.

That ends our first round. We have enough time for two more slots for MPs. We're going to start off with the Liberals.

Ms. Lapointe.

[Linda Lapointe, Liberal, Rivière-des-Mille-Îles, QC]

Thank you, Mr. Chair.

Mr. Sacco, I have a few questions for you.

You said earlier that you represent the National Federation of Canadian Italian Business and Professional Associations.

Does that mean that your organization has various chapters in Canada?

[Robert Sacco]

Yes.

[Linda Lapointe, Liberal, Rivière-des-Mille-Îles, QC]

How many members does your federation have?

[Robert Sacco]

There are roughly 1,500 dues-paying members.

[Linda Lapointe, Liberal, Rivière-des-Mille-Îles, QC]

Does that include SMEs?

In your opinion, what can we do to ensure that ties develop quickly between Canadian and Italian businesses?

Do you represent a lot of SMEs?

[Robert Sacco]

We represent small, medium, and large businesses. One example of an Italian-born, Canadian-raised entrepreneur is Sergio Marchionne. He was born in Abruzzo, Italy, came to Canada, went to school in Canada, articled as a CA here, and then I believe also went to law school in Windsor. He then went back to Europe and led Chrysler Fiat, which is one of the largest manufacturers in the world. We have relationships with all aspects of big and small businesses and we'd like to encourage more activity. We really do think that Canadian businesses need to think about Europe as an opportunity to grow. We think that we've been a little too dependent on the U.S.

We really do need to start thinking about, for example, CETA. It is going to provide a phenomenal opportunity for European businesses to come to Canada. That means they're going to compete with Canadian businesses. That's probably good for the economy, in that you have good competition and value for services provided. We need to do the same thing and go to Europe and compete in Europe as well.

[Linda Lapointe, Liberal, Rivière-des-Mille-Îles, QC]

You mentioned the free trade agreement with Europe that came into effect on September 21, 2017.

Have you promoted this new agreement so that companies, be they Canadian or Italian, can benefit from the privileges associated with it?

[Robert Sacco]

Absolutely. We have regular dinner meetings and we invite all members of the business community, as well as governments, to talk. We have women's events that are primarily for women to deal with women's issues and business opportunities. The Canadian forum we provide and we always have the opportunity to network with our Italian colleagues as well.

[Linda Lapointe, Liberal, Rivière-des-Mille-Îles, QC]

You talked earlier about SMEs with the individuals here. In the case of dealings between businesses, is it possible to make it easy for people to find businesses throughout Italy and elsewhere?

[Robert Sacco]

I believe that with the Internet you have a phenomenal opportunity globally to do all kinds of business. I think Canadians do not use to the full benefit the federal concierge services, Export Development Canada, the Business Development Bank of Canada. There are a lot of opportunities to get help from Canadian federal organizations.

What I really think needs to happen is that people need to get into an airplane, meet people, actually find the market for their product, and do as entrepreneurs and SMEs do. They do business. You're going to win some and you're going to lose some, but at the end of the day, I believe we can compete with the globe.

[Linda Lapointe, Liberal, Rivière-des-Mille-Îles, QC]

I now have a question for Mr. Potoczny.

[The Chair, Liberal, Mark Eyking]

It has to be a short question and short answer.

[Linda Lapointe, Liberal, Rivière-des-Mille-Îles, QC]

The President of Ukraine visited us yesterday. He said the service sector is the most promising.

What do you think?