Canadian Prime Minister Justin Trudeau has said that there were 'credible reasons' for the allegation.
Meanwhile, Canada has reduced its personnel in India saying some diplomats had received threats on social media.
"As I said on Monday, there are credible reasons to believe that agents of the government of India were involved in the killing of a Canadian on Canadian soil," he said and added that by doing so, the country is standing up for the "rules based international order that we believe in".
When asked if Indian Prime Minister Narendra Modi had confirmed or denied these allegations, Mr Trudeau said he had had a "direct and frank conversation" with Mr Modi "in which I shared my concerns in no uncertain terms". India had then issued a sharp statement saying that it had "strong concerns about continuing anti-India activities of extremist elements in Canada" who it accused of "promoting secessionism and inciting violence against Indian diplomats".Image source,Sikhs protest for the independence of Khalistan in front of the Indian consulate in Toronto in July