For the first time, Canada’s Department of Finance has publicly acknowledged that Khalistani extremist groups are actively raising funds within the country, a development that could carry serious domestic and international implications. The statement, included in a recently released government report, points to concerns over the use of Canada’s financial system by organizations linked to separatist movements in India’s Punjab region.
According to the report, authorities are monitoring suspicious financial flows that may be connected to extremist activities. While specific organizations were not named, the Department of Finance confirmed that such fundraising is occurring and represents a risk to both Canada’s national security and its international reputation. Officials emphasized that Canada is committed to strengthening its counter-terrorism financing framework and ensuring that the country does not become a safe haven for extremist fundraising.
The acknowledgment comes amid already strained relations between Canada and India, following months of diplomatic tension over allegations of foreign interference, diaspora activism, and the assassination of individuals linked to Sikh separatist movements abroad. India has repeatedly accused Canada of being soft on groups it designates as extremists, while Ottawa has defended freedom of speech and assembly within its borders.
Security experts say this public confirmation may mark a turning point in how Canada deals with extremist financing. It could also open the door to tighter financial regulations, more aggressive law enforcement investigations, and closer cooperation with India and other international partners in monitoring and shutting down illicit funding networks.
For now, the Department of Finance has stated that it is working with intelligence and security agencies to trace the flow of funds and assess their potential impact. The government has also pledged to maintain transparency while balancing civil liberties, as the issue remains highly sensitive within Canada’s diverse Sikh community, many of whom are not connected to separatist activities.
This development is likely to fuel ongoing debates about Canada’s approach to counterterrorism, diaspora politics, and its broader relationship with India at a time when both countries are navigating complex geopolitical challenges.