Prime Minister Gujral welcoming US Secretary
of State Albright during her visit to India
India-US relations continued to see steady diversification during 
1996-97. The expansion of the pace and scope of exchanges between the two countries continued on a full range of political, scientific, technological and social issues. Trade and investment continued to be the cornerstone of bilateral relations. However, India and the US continued to have a different perception and approach to nuclear and missile non-proliferation issues, as was reflected in the CTBT negotiations during the year. An Amendment to the US Foreign Operations Bill to restrict US bilateral aid to India to the last year's
initial allocation was defeated in the House of Representatives by decisive 296 votes to 127. The Republican Senator Dan Burton for alleged human rights proposed the amendment violations in Punjab and Kashmir. US Assistant Secretary of State for South Asian Affairs held discussions in September 1996 with senior officials of the Ministry of External Affairs on wide-ranging issues concerning Indo-US relations. Deputy US Trade Representative and Deputy Assistant US Trade Representative visited India from 7-10 October 1996 to hold bilateral discussions. US Coordinator for counter-terrorism was in India on 14 and 15 October. The year also witnessed greater interaction with US Congressmen and Senators.

Bilateral defense relations with the US continued to develop satisfactorily during 1996-97. The 2nd meeting of the Indo-US Defense Policy Group (DPG) took place in Delhi on 23 and 24 October 1996. The two sides had a detailed exchange of views on security perceptions in the Asia-Pacific and on issues of mutual concern. In the field of defense research and production cooperation, they agreed on a program of immediate cooperation on high priority areas as well as additional areas for possible future joint ventures. Prior to the DPG meeting, Joint Technical Group related to joint research and development in defense cooperation met. Chief of Army Staff visited the US in September 1996. The Commander-in-Chief of the US Pacific Command Admiral led a delegation to India from 9-12 January 1997. As a part of Indo-US defense cooperation, the joint Indo-US Naval exercise Flash Iroquoise/Sangam'96 was held in September 1996.

Several business related visits took place during 1996-97. Governor of Ohio State, Lieutenant Governor of Kentucky and a Congressman from Seattle led business delegations to India. The second board of meeting of the private sector alliance between the US and Indian business, the Indo-US Commercial Alliance-was held in Washington and the 19th meeting of Indo-US joint Business Council was held in New Delhi.

India-Canada relations saw remarkable expansion. The Minister of External Affairs visited Canada from 29 September-1 October 1996. Apart from the official discussions with his counterpart, he met with captains of industry and commerce, and held a round table discussion with academics and foreign policy experts. Minister of Foreign Affairs of Canada accompanied by a high level delegation consisting of Members of the Canadian Parliament and senior officials visited India from 7-15 January 1997. The two Ministers agreed to intensify cooperation to combat terrorism in all its forms, regardless of its motives. They also exchanged notes establishing a Joint Ministerial Committee for intensifying cooperation and consultations between the two countries in the political as well as in the economic and commercial fields. At Chandigarh, an office of the Canadian High Commission was jointly inaugurated by the Minister of External Affairs and the Canadian Foreign Minister. Member of Parliament and member of the Standing Committee on Foreign Affairs and International Trade in the Canadian Parliament visited India from 19-22 November 1996 as a special representative of the Canadian Prime Minister to explore new and innovative ways of expanding India-Canada interaction and cooperation. Canadian Minister of Citizenship and Immigration visited India from 10-13 April 1996 primarily to inspect the Canadian High Commission's Consular Section in New Delhi, which is one of Canada's largest visa issuing outlet in the world. In October 1996, the President of the Canadian Space Agency visited India to hold bilateral discussions with ISRO. Civil Aviation talks were held between senior Indian and Canadian officials. An agreement was reached for increased seat allotment between Air India and Air Canada.