New oil, gas and uranium ties with India aim to turn demand shock into long‑term Canadian gains
Canada is trying to cut its dependence on US energy buyers by riding India’s demand boom.
According to Global News, 97 percent of Canada’s energy exports still go to the United States, yet Prime Minister Mark Carney has vowed to double non‑US exports.
India, which Natural Resources Canada calls “the epicenter of global energy landscape,” is already the world’s third‑largest oil consumer, fourth‑largest LNG importer and third‑largest LPG consumer. It is projected to drive more than one‑third of global energy demand growth over the next two decades.
Bloomberg reports that Canada and India have relaunched their Ministerial Energy Dialogue in Goa.
Energy Minister Tim Hodgson and India’s Petroleum and Natural Gas Minister Hardeep Singh Puri agreed that Canada will ship more crude, LNG and LPG to India, while India will send more refined petroleum products to Canada.
Natural Resources Canada’s joint statement says both sides intend to “deepen bilateral energy trade including supply of Canadian LNG, LPG, and crude oil to India, and supply of refined petroleum products from India to Canada.”
So far, the base is small.
Global News, citing Statistics Canada, says Canada’s total energy exports to India were $761.5m in 2024, mostly $602m in coal and $158m in crude oil and bitumen, with India selling $206m in refined petroleum products to Canada.
Bloomberg reports that overall two‑way goods trade reached $13.3bn in 2024, and that India accounts for just 1 percent of Canada’s critical minerals exports, which Ottawa sees as a major growth gap.
Infrastructure and timing are starting to shift.
Canada began exporting LNG to Asia in June 2025, its LPG terminals have relatively short routes to India, and the Trans Mountain expansion has opened a more direct path for crude to India, even if many barrels still move via the US Gulf Coast.
Natural Resources Canada adds that Ottawa launched a Major Projects Office in 2025 and moved to accelerate energy and resource projects worth more than $116bn, with Asia flagged as a priority region.
Global News reports that in 2023‑24, India imported nearly 88 percent of its crude and 47.1 percent of its natural gas. Russia still supplied 37.1 percent of India’s oil imports, despite a 17.8 percent drop that some experts partly link to EU sanctions on refined products made from Russian crude.
Natural Resources Canada says India is scaling up domestic oil output, expanding refining capacity, increasing gas use and signalling about US$500bn in opportunities across its energy value chain.
Hodgson framed the stakes in demand terms.
As Global News reported from Davos, he said “India is requiring 70 percent more energy by 2040.
As you know, Canada has the energy. India’s year‑over‑year growth is about seven percent, so they need food, they need energy. We have that.”
According to Natural Resources Canada, the two ministers also highlighted potential collaboration in hydrogen, biofuels, sustainable aviation fuel, battery storage, critical minerals, and clean technologies.
They also pointed to opportunities to use artificial intelligence in the energy sector, along with carbon capture and other emissions‑reduction tools for conventional energy.
This reset follows a sharp diplomatic chill.
Reuters recalls that former prime minister Justin Trudeau accused the Indian government in 2023 of involvement in the killing of Sikh separatist leader Hardeep Singh Nijjar, which India denied.
Global News reports that India later expelled six Canadian diplomats and withdrew one envoy, while Canada expelled India’s high commissioner and five other diplomats.
Both sides have since reappointed high commissioners.
Despite that history, Reuters says Carney is “resetting relations with India” as part of “all‑out efforts” to diversify alliances beyond the US. He and Prime Minister Narendra Modi agreed in November to restart talks toward a Comprehensive Economic Partnership Agreement (CEPA).
India’s High Commissioner to Canada, Dinesh Patnaik, expects formal CEPA negotiations to begin in March and said a pact “could be signed” within a year of launching talks.
Patnaik told Reuters he expects Carney to visit India as early as the first week of March to sign agreements on uranium, energy, minerals, and artificial intelligence, along with smaller deals on nuclear energy, oil and gas, the environment, AI, quantum computing, education and culture.
A 10‑year $2.8bn uranium supply deal is “likely” to be included.
Hodgson did not confirm that but told Reuters Canada is prepared to sell uranium under the Canada‑India nuclear co‑operation agreement as long as India complies with International Energy Agency safeguards.
These moves sit within a wider response to a more volatile trade environment.
Carney’s push to double non‑US exports follows an agreement with China to cut tariffs on electric vehicles and canola and open up to US$7bn in export markets, which triggered threats from US President Donald Trump of 100 percent tariffs on Canadian goods if Ottawa “makes a deal with China.”
Carney has stressed that Canada will honour its United States‑Mexico‑Canada Agreement commitment not to pursue free‑trade pacts with “non market economies” and is not seeking a free trade agreement with China.
Patnaik told Reuters that both Canada and India now move with “a sense of urgency” after two years of stalled talks and in a world where “the natural rules‑based order which gave a certainty to the world is not functioning.”
