Canada’s Spy Report on Khalistan: Key Takeaways
Canada’s latest intelligence reporting has placed the Khalistan issue back at the center of India-Canada relations. The Canadian Security Intelligence Service, or CSIS, has warned about two sensitive and politically explosive concerns at the same time: Canada-based Khalistani extremism and foreign interference by India.
That dual message is important. The report does not reduce the issue to one side’s grievance. It recognizes that Canada faces a national security challenge from violent extremism linked to a small segment of Khalistan supporters, while also saying foreign states, including India, have engaged in interference activity in Canada. CSIS says it is authorized to investigate threats such as espionage, foreign interference, terrorism, violent extremism, sabotage, and subversion, but it is prohibited from investigating lawful advocacy, protest, or dissent.
For readers trying to understand the issue, the key point is this: Canada is trying to distinguish between protected political speech, extremist violence, diaspora intimidation, and foreign-state interference. That is not easy, especially when the Khalistan movement sits at the intersection of history, Sikh diaspora politics, Indian national security concerns, and Canadian civil-liberties protections.
What the CSIS Report Says
CSIS says foreign interference and espionage by state actors continued in Canada in 2025, targeting institutions, private companies, universities, civil society, and ethnic, religious, and cultural communities. The agency named the People’s Republic of China, India, Russia, Iran, and Pakistan among the main perpetrators of foreign interference and espionage against Canada.
The India-related section has drawn particular attention because Canada-India relations were already strained after former Prime Minister Justin Trudeau publicly alleged in 2023 that India was linked to the killing of Sikh separatist leader Hardeep Singh Nijjar in British Columbia. India denied involvement and accused Canada of giving space to Sikh separatists. Reuters reported that the CSIS report described India as a perpetrator of foreign interference and said transnational repression plays a central role in India’s activity in Canada.
At the same time, India has highlighted another part of Canadian intelligence reporting: the acknowledgment that Canada-based Khalistani extremists, or CBKEs, have used Canada as a base to promote, fundraise, or plan violent activity primarily targeting India. India’s Ministry of External Affairs cited the CSIS 2024 annual report as saying the PMVE threat in Canada has manifested primarily through CBKEs seeking to use and support violent means to create Khalistan.
Key Takeaway 1: Canada Separates Khalistan Advocacy From Extremism
One of the most important distinctions in the report is between lawful advocacy and violent extremism.
Canada is a liberal democracy with strong protections for speech, protest, religious identity, political advocacy, and diaspora activism. Supporting the idea of Khalistan, however controversial, is not automatically a crime in Canada. But planning violence, funding violence, threatening people, intimidating communities, or supporting extremist activity is a national security matter.
CSIS makes this distinction clear by stating that it does not investigate lawful advocacy, protest, or dissent.
This matters because public debate often blurs the line. India frequently argues that Canada has been too permissive toward Khalistani separatist activity. Sikh advocacy groups argue that India labels legitimate political dissent as extremism. Canada’s intelligence position appears to be: speech is protected, violence is not.
That distinction will shape how Canadian authorities handle future protests, referendums, fundraising networks, threats, and diaspora political activity.
Key Takeaway 2: Canada Acknowledges a Khalistani Extremist Threat
For India, one of the most significant points is that Canadian intelligence has acknowledged a security threat from Canada-based Khalistani extremists.
India’s Ministry of External Affairs said CSIS, in its 2024 annual report, confirmed for the first time that Khalistani extremists were using Canadian soil as a base to promote, fundraise, and plan violent activities, primarily targeting India. The ministry also quoted the report as saying the ongoing involvement in violent activities by CBKEs continues to pose a national security threat to Canada and Canadian interests.
This is diplomatically important because New Delhi has long complained that Canada has not done enough to address extremist networks, separatist financing, threats against Indian diplomats, and glorification of violence linked to the Khalistan movement.
For Canada, the challenge is to act against genuine threats without criminalizing Sikh identity or peaceful political opinion. Most Sikhs in Canada are not extremists, and it would be wrong to treat a diverse community as a security problem. The report’s focus is on violent extremism, not Sikh Canadians as a whole.
Key Takeaway 3: Canada Also Accuses India of Foreign Interference
The report is not one-sided. It also says India is among the foreign states involved in interference and espionage activity in Canada.
Reuters reported that CSIS described Indian officials and Canada-based proxy agents as engaging in activities aimed at influencing Canadian communities and politicians, especially around how India views Canada-based supporters of Khalistan. Reuters also reported that the CSIS report said transnational repression plays a central role in India’s activity in Canada.
This is the most sensitive part for India-Canada relations.
Foreign interference is different from normal diplomacy. All governments try to influence other countries through official channels, public messaging, lobbying, and diplomacy. But Canada defines foreign interference as activity that is clandestine, deceptive, or involves threats to people, and that is harmful to Canadian interests.
So when CSIS names India in this category, it is saying the issue goes beyond ordinary diplomatic disagreement.
Key Takeaway 4: Transnational Repression Is Now Central to the Debate
The phrase transnational repression has become central to the Canada-India dispute.
It refers to a foreign state allegedly targeting critics, dissidents, activists, or diaspora members outside its borders through threats, surveillance, intimidation, coercion, or violence.
Reuters reported that the CSIS report said transnational repression plays a central role in India’s activity in Canada, and that the RCMP had communicated more than a dozen threats to Sikhs advocating for a homeland carved out of India.
This is one of the reasons the issue remains emotionally charged. Sikh activists in Canada argue that they face intimidation for political speech. India argues that some Khalistan-linked activity crosses into extremism, separatist violence, and anti-India threats.
Canada is now trying to manage both concerns at once: preventing extremist violence while protecting Canadian residents from foreign intimidation.
Key Takeaway 5: The Nijjar Killing Still Shapes Everything
The 2023 killing of Hardeep Singh Nijjar remains the defining event in the current diplomatic crisis.
Nijjar was a Sikh separatist leader in Canada. Canada alleged Indian government involvement in his killing; India denied the allegation. The dispute triggered diplomatic expulsions, a breakdown in trust, and a wider debate over whether foreign governments were targeting dissidents in Canada.
Reuters noted that India-Canada relations have been tense since Trudeau’s 2023 accusation, and that Modi’s government denied involvement while accusing Canada of providing a safe haven for Sikh separatists.
Even when Ottawa and New Delhi try to repair relations, the Nijjar case remains in the background. For Sikh activists, it is a symbol of alleged foreign repression. For India, the broader Khalistan issue remains a national security concern. For Canada, it is a test of sovereignty, public safety, and rule of law.
Key Takeaway 6: India and Canada Are Trying to Rebuild Ties
Despite the intelligence concerns, both countries have also shown interest in stabilizing relations.
India’s Ministry of External Affairs said Prime Minister Narendra Modi and Canadian Prime Minister Mark Carney met on June 17, 2025, on the sidelines of the G7 summit in Kananaskis, Canada. Both sides reaffirmed democratic values, rule of law, sovereignty, and territorial integrity, and agreed on the need for a constructive relationship based on mutual concerns and sensitivities.
Reuters also reported that Carney and Modi held productive talks at the G7 and agreed to reinstate top diplomats withdrawn the previous year.
This shows both governments understand the relationship is too important to remain frozen. Canada and India have deep people-to-people links, trade interests, student flows, security concerns, and diaspora ties. But rebuilding trust will be difficult unless both sides address each other’s core concerns.
Key Takeaway 7: Canada’s Position Appears to Be Evolving
A senior Canadian government official said in February 2026 that Canada no longer believed there was an active threat of Indian government-linked violence in Canada, according to Canadian Press reporting carried by CityNews. The same report said Canadian officials still emphasized rule of law, public safety, and ongoing law-enforcement dialogue with India.
That does not erase the earlier allegations or the CSIS findings. But it suggests Ottawa may be trying to move from crisis management toward controlled engagement with New Delhi.
For Sikh activists, that shift has created concern that Canada may prioritize trade and diplomacy over accountability. For India, it may be a sign that the relationship can gradually normalize if Canada takes action against extremist networks.
Key Takeaway 8: Diaspora Communities Are at the Center
The Khalistan issue in Canada is not only a foreign-policy dispute. It is also a diaspora-community issue.
Canada has one of the world’s largest Sikh populations outside India. Sikh Canadians are active in politics, business, religious life, public service, and civil society. The vast majority are ordinary citizens and residents with no connection to extremism.
But because Khalistan activism exists within parts of the diaspora, the community can become caught between multiple pressures: Indian government concerns, Canadian security scrutiny, internal community divisions, and fears of foreign intimidation.
CSIS says foreign interference can target ethnic, religious, and cultural communities in Canada. That point matters deeply. Diaspora communities should not become battlegrounds for foreign governments or extremist groups.
Why the Report Matters
The CSIS reporting matters because it gives both Canada and India politically useful but uncomfortable facts.
For India, the acknowledgment of Canada-based Khalistani extremism supports New Delhi’s long-running concern that anti-India violent networks have found space in Canada.
For Canada, the naming of India as a foreign-interference actor reinforces Ottawa’s concern that foreign governments cannot intimidate or influence Canadian communities through covert or coercive means.
For the Sikh diaspora, the report is a reminder that their community is often discussed through a security lens, even though most Sikh Canadians are law-abiding citizens with diverse political views.
For diplomacy, the report makes clear that any reset between Canada and India must be built on two tracks: action against violent extremism and action against foreign interference.
Final Verdict
Canada’s spy report on Khalistan delivers a complicated but important message: Canada sees both Canada-based Khalistani extremism and Indian foreign interference as serious security concerns.
The report does not say peaceful Khalistan advocacy is illegal. It explicitly separates lawful advocacy and protest from threats to national security. But it also recognizes that violent extremist activity linked to Canada-based Khalistani extremists remains a threat.
At the same time, CSIS identifies India as one of the foreign states involved in interference and espionage activity in Canada, with Reuters reporting that the agency linked Indian activity to efforts to influence Canadian communities and politicians around Khalistan-related issues.
The biggest takeaway is that Canada and India must now deal with two realities at once. Canada must prevent its territory from being used for violent extremism. India must address Canadian concerns about sovereignty, intimidation, and foreign interference. Without progress on both fronts, the Khalistan issue will continue to strain one of the world’s most important diaspora-linked relationships.
