Canada hit by US-China tariff war: Job losses, rising costs worry Indian diaspora
Canada is caught in a growing trade war with the US and China, leading to job losses and rising costs. Indian-origin workers and students are feeling the impact as industries struggle. Experts warn of worsening economic conditions.
FollowCanada is grappling with a deepening trade conflict as both the United States and China impose heavy tariffs on its key exports. Washington has cited trade imbalances and border security concerns, while Beijing retaliated with steep duties on Canadian seafood and agricultural products after Ottawa banned Chinese steel, aluminum, and electric vehicles.
With nearly 1.86 million people of Indian origin living in Canada, the economic fallout is expected to have serious consequences, especially for workers, business owners, and students.
Also read: Canada announces CAD 29.8 bn reciprocal tariffs on US goods over steel and aluminum dispute
Job losses and economic uncertainty
The US tariffs have already started taking a toll. Alubar, a major aluminum rod manufacturer in Bécancour, ceased operations on March 4, 2025, directly blaming American duties. The United Steelworkers Union (USW), representing 70 affected workers, is urging Canadian authorities to take immediate action, including modernizing industrial plants and supporting impacted employees.
Experts warn that job losses could spread across Canada’s automobile and manufacturing sectors. Canada-based immigration analyst Darshan Maharaja was quoted by Business Standard saying, "Investment is slowing down as businesses wait to see how the investment climate shapes up. This will impact job prospects for workers across multiple industries."
Rising cost of living and immigration concerns
As trade tensions intensify, living expenses in Canada are expected to rise, says the Business Standard report. Jack Kim, a partner at the US-based law firm Fragomen, noted that while tariffs have not yet affected Canada’s immigration system, economic instability could eventually lead to changes in permanent residency policies. “We've seen cases where stricter immigration vetting was used as a bargaining tool, like in Colombia. While there are no signs of this yet in Canada, we’re closely monitoring the situation,” Kim told Business Standard.
Explained | US-China trade tensions rise: How is Beijing fighting back?
Impact on students and the Indian diaspora
While international students in service and retail jobs may not face immediate job losses, the weakening economy and rising living costs will hit them hard after graduation. The number of Indian students choosing Canada for higher studies has already declined sharply—dropping by 41% in 2024 compared to the previous year, according to Indian government data.
The worsening economic outlook has also raised concerns for potential immigrants. “This tariff war does not have a direct impact on immigration, but those considering moving to Canada should factor in the country’s economic struggles,” Maharaja cautioned.
Also read: China's exports face major threat as US tariffs rise under Trump's second term
Global leaders watching Canada’s response
The trade war’s impact on Canada is being closely observed by world leaders, including those in New Delhi and Brussels, who are also dealing with tariffs imposed by US President Donald Trump’s administration. With economic pressures mounting, experts warn that Canada must act swiftly to prevent further economic distress.
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