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India and Canada need new friends — and customers. So this week, they put past, painful differences aside to pledge closer ties during Prime Minister Mark Carney's visit to New Delhi, as U.S. and Israeli strikes on Iran escalated.

But the commitment is far from a full reset. It comes after the assassination of a Sikh activist, Hardeep Singh Nijjar, in Canada in 2023, which caused tensions between India and Canada, with each side expelling diplomats the following year. The Canadian government had accused Indian Minister of Home Affairs Amit Shah, a close ally of Prime Minister Narendra Modi, of plotting to target Sikh separatists in Canada. India has emphatically denied any connection to the killing.

Reema Bhattacharya, head of Asia risk insight, corporate risk and sustainability at Singapore-based risk advisory firm Verisk Maplecroft, told CNBC that a "true reset" in the relationship would depend on whether the visit leads to "sustained, working-level cooperation."

She added that Nijjar's killing "remains the single biggest political constraint on the relationship" and is unlikely to fade because "one meeting went well."