In the first sign that a diplomatic spat is affecting trade ties, India’s JSW Steel Ltd is slowing down the process to buy a stake in the steel making coal unit of Canada’s Teck Resources, reports said.
Ties between India and Canada deteriorated sharply after New Delhi and Ottawa expelled each other’s diplomats in a dispute over the murder of a Sikh separatist leader in the Canadian province of British Columbia in June.
The source said discussions between JSW Steel – India’s largest steelmaker by capacity – and Teck over the stake sale had slowed down, though work on the paperwork was going on. “We will wait until the issue subsides,” reports added. “We are not expecting things to go out of hand. We are doing the paperwork for the valuation, talking to banks and this is still happening,” the source added.
Canada’s industry ministry, which approves foreign investment deals, said that the acquisition of a Canadian company by a foreign company would be subject to a national security review under the Investment Canada Act.