Canada's Big Admission About Khalistani Terror Groups

In a significant development validating India’s concerns about anti-India activities on Canadian soil, a new report from Canada’s Department of Finance has, for the first time, officially acknowledged that Khalistani extremist groups are operating in the country and receiving financial support.

The report on the "most pressing money laundering and terrorist financing threats and vulnerabilities in Canada", classified the Khalistanis as terrorist groups that encourage the use of violence to pursue political objectives or self-determination.

"Several terrorist entities listed under the Criminal Code in Canada that fall under the PMVE (politically motivated violent extremism) category, such as Hamas, Hezbollah, and the Khalistani violent extremist groups Babbar Khalsa International and the International Sikh Youth Federation, have been observed by law enforcement and intelligence agencies to receive financial support originating from Canada," the report said.

“The 2025 Assessment of Money Laundering and Terrorist Financing Risks in Canada” further noted that these groups previously had an extensive fundraising network in Canada, but now appear to consist of smaller pockets of individuals with allegiance to the cause but seemingly no particular affiliation to a specific group.

The report also highlighted that Khalistani extremist groups have historically solicited donations from diaspora communities and raised funds through non-profit organisations, although such revenue represents only a small portion of their overall operational budgets. Criminal activity also serves as a source of funding for groups involved in politically motivated violent extremism, including the Khalistanis.

"These groups use diverse funding methods to sustain their operations, including the abuse of the MSB and banking sectors; use of cryptocurrencies; state financing; abuse of the charitable and NPO sector; and criminal activity," the report said.

The Khalistani movement, comprising multiple organisations, seeks to establish an independent, sovereign state called Khalistan in Punjab. India has repeatedly raised concerns over Khalistani activities in Canada, which were long ignored by Ottawa, contributing to a deterioration in diplomatic ties between the two countries.

In September 2023, then-Canadian Prime Minister Justin Trudeau accused India of involvement in the murder of Khalistani terrorist Hardeep Singh Nijjar in Canada. India strongly rejected the unsubstantiated claims, leading to an unprecedented diplomatic standoff, including the withdrawal of envoys.

Relations appeared to improve after Mark Carney assumed office as Canada’s Prime Minister, pledging to address India’s concerns.