(CANADA) — Canada and India have reset diplomatic ties after the 2023 crisis, a shift that is beginning to ease pressure on study permits for Indian students even as Ottawa keeps tight caps on international enrolment.

High commissioners were reinstated on August 28, 2025, and a “New Roadmap for Canada-India Relations“ was announced on October 13, 2025, steps that officials and educators hope will support smoother visa processing.

Background: 2023 diplomatic rupture and immediate fallout

The diplomatic freeze followed allegations around the 2023 killing of Sikh separatist Hardeep Singh Nijjar in British Columbia. That crisis spilled into education and migration flows between the two countries.

• In October 2023, India expelled 41 Canadian diplomats — roughly two-thirds of Canada’s staff in India — and Canada halted in-person study permit processing at Indian consulates.
• Marc Miller, Canada’s immigration minister at the time, told Reuters the fallout “halved our ability to process applications from India,” as fewer students submitted applications.
• Prime Minister Justin Trudeau said in June 2023 there were “credible allegations” linking Indian agents to Nijjar’s murder, an assertion India dismissed as “absurd.“

The immediate impact on study permits was dramatic. Study permits for Indian students plunged 86% in late 2023 as consular capacity dropped.

Timeline of diplomatic restoration (2025)

By mid-2025, the two countries moved to restore channels and working-level ties:

• June 2025: Prime Ministers Mark Carney and Narendra Modi held sideline talks at the G7 Summit.
• September 18-19, 2025: Pre-Foreign Office Consultations and meetings between national security advisers in New Delhi.
• September 29, 2025: Foreign ministers met at the UN General Assembly in New York.
• October 12-14, 2025: Canada’s foreign affairs minister Anita Anand visited New Delhi; a joint statement emphasized a “stronger partnership” highlighting people-to-people ties, education and economic growth.
• October 13, 2025: Announcement of the New Roadmap for Canada-India Relations.
• December 1, 2025: Carney and Modi relaunched negotiations for a Comprehensive Economic Partnership Agreement, targeting US$50 billion in bilateral trade by 2030 (up from US$30 billion in 2024).
• August 28, 2025: High commissioners reinstated (note: reinstatement date preceded some later steps).

At the G7 in Kananaskis, Alberta, Carney and Modi agreed to “calibrated measures to restore stability,” signaling intent to reopen the consular and working-level ties that underpin visa services.

Impact on study permits — key numbers

The diplomatic disruption and later policy changes produced sharp swings in approvals.

• Quarterly study permit figures:
• Q3 2023: 108,940 (Indian students)
• Q4 2023: 14,910
• Drop of roughly 86% between those quarters

• National cap and approval snapshots:

• 2024 national cap: 360,000 study permits (described as a 35% cut from 2023 projections)
• Canada issued under 300,000 study permits that year.
• IRCC estimated Indian approvals down 30–40% year-over-year; Indians still made up about 25% of approvals (~72,000).
• 2025 cap: 437,000, with exemptions for master’s and PhD students; system prioritized graduate programs.
• Indian study permits rose modestly to about 85,000 in 2025 (VisaVerge summary).
• Current enrolled Indian student population (VisaVerge): over 300,000 in Canada.

Table: Selected figures

Policy changes and processing capacity

The downturn reflected both consular capacity loss and later national policy shifts:

• Consular capacity: Fewer diplomats in India reduced in-person processing, though online applications remained the norm.
• National caps: Ottawa implemented caps to curb the number of incoming international students, directly shaping demand and approval totals.
• Processing: Restoration of diplomatic staffing helped processing capacity rebound, but the cap structure and added documentation requirements constrained growth.

Important: The diplomatic thaw improved certainty and processing capacity, but Canada’s capped system still sets the ceiling for how quickly study permits for Indian students can rebound.

University finances, enrolment and housing pressures

Indian students had been a dominant group in Canada’s international cohort:

• 2022: Indian students accounted for 41% of study permits (225,835 total).
• International tuition typically averages C$40,000 per year per student.

Financial impacts on institutions:

• VisaVerge reported Canadian universities faced a C$1–2 billion revenue shortfall linked to fewer Indian students.
• The University of Toronto and UBC reportedly had 20–30% Indian enrollment and cut programs and staff in 2024–2025.

Housing pressures were central to Ottawa’s cap policy:

• VisaVerge described shortages exacerbated by projected 900,000+ students for 2023.
• Marc Miller called volumes “out of control” before the 2025 election, as ministers weighed strain on housing, services and public confidence.
• Carney’s government extended caps into 2026, tying allocations to housing starts (VisaVerge).

Compliance, quality concerns and institutional consequences

Heightened scrutiny targeted institutions that recruit foreign students:

• India’s High Commission raised concerns about “fly-by-night” schools.
• Canada intensified compliance checks; VisaVerge said 50+ Designated Learning Institutions lost status in 2025 for non-compliance.
• Loss of DLI status can affect student eligibility for study permits and related work authorization.

Student work, spousal permits and post-graduation changes

Rules around student employment and post-study pathways tightened:

• Off-campus work: Capped at 24 hours/week starting in 2024 (down from previously unlimited), raising concerns about labour shortages in retail and hospitality.
• Spousal open work permits: Restricted to master’s and PhD students starting in 2024.
• Post-graduation work permits (PGWP): Tightened for generous programs; new limits of 1–3 years depending on degree level, with ineligibility for low-quality schools.

These changes affect both students already in Canada and those considering study destinations.

Alternatives and international competition

As Canada tightened caps and compliance, other destinations attracted Indian students:

• Australia: Issued 112,000 student visas to Indians in 2025, up 15%.
• UK: Issued 140,000 student visas in 2025, remaining popular despite its own limits.

Competition underscores that processing efficiency and predictability are key factors for students choosing destinations.

Economic contribution and education cooperation

Despite reduced approvals, international students contributed significantly to Canada’s economy:

• VisaVerge reported international students contributed C$40 billion+ to Canada’s GDP in 2024, up from C$22 billion in 2022.
• Indians remained central to this contribution despite lower approvals.

The October 2025 roadmap emphasized people-to-people links and higher education collaboration:

• Areas highlighted included AI research, overseas campuses, and creation of a Joint Working Group on Higher Education to support exchanges over time.

Implications and outlook (early 2026)

• For students and universities, the diplomatic thaw reduced some uncertainty from the 2023 expulsions, improving consular capacity and processing.
• However, Canada’s capped system remains the primary limit on how quickly study permits for Indian students can recover.
• Policymakers face a trade-off: balancing housing constraints and compliance enforcement with the economic value of international students and diplomatic benefits of educational ties.

Overall, restoration of diplomatic ties has eased some immediate pressures, but structural caps, tighter compliance and altered work/post-study rules will continue to shape Indian student flows to Canada in the near term.