In a first, Canada admits Khalistani groups raise funds from its soil: Report

Amid regular concerns raised by New Delhi over the use of Canadian soil for anti-India activities, a report by the Canadian government has claimed that a couple of Khalistani groups – Babbar Khalsa International and International Sikh Youth Federation – are operating in the country and have received financial support originating from Canada. 

The report, titled ‘2025 Assessment of Money Laundering and Terrorist Financing Risks in Canada’, claimed that Politically Motivated Violent Extremism (PMVE) “encourages the use of violence to establish new political systems, or new structures and norms within existing systems”.

Khalistani groups use diverse funding methods 

It said several groups, including Babbar Khalsa International, International Sikh Youth Federation, Hamas and Hezbollah, fall under this category and have been receiving funds from Canada. These groups use diverse funding methods, such as abuse of the money services businesses (MSB), banking sector, the charitable and NPO sector, and the use of cryptocurrencies, to sustain their operations. 

The Khalistani groups, the report said, “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.”

“Despite these observations, it is estimated that revenue generation through NPO abuse represents a relatively small percentage of operational budgets of terrorist groups overall,” the report stated. 

“In 2024 the Egmont Group, a united body of 174 Financial Intelligence Units, published an overview of NPO abuse typologies and ways for financial intelligence units to make the best use of international cooperation by sharing financial information and intelligence to enhance detection and achieve better results in disrupting the abuse of NPOs to finance terrorism,” it noted.

India’s repeated concerns

The report by the Canadian government has vindicated India’s concerns that pro-Khalistani groups use Canadian soil to carry out anti-India activities. India has also repeatedly raised these issues with Canada, but the latter’s former Prime Minister Justin Trudeau had alleged that the former was involved in the murder of Khalistani terrorist Hardeep Singh Nijjar. 

Trudeau’s allegation led to a diplomatic row between India and Canada. However, the situation between the two countries is slowly improving after Mark Carney succeeded Trudeau as Canada’s Prime Minister.