(Reuters) - Canadian Prime Minister Justin Trudeau on Tuesday took a cautious line over talks to update NAFTA, saying he saw a possibility that Canada could build on a bilateral deal that the United States and Mexico have already agreed.

With time fast running out ahead of a U.S.-imposed deadline to conclude talks on the North American Free Trade Agreement, Canadian and American negotiators are making slow progress. The U.S. administration has threatened to leave Canada out.

“They (the United States and Mexico) made certain agreements. I think there’s a possibility there to build on what they agreed,” Trudeau said when asked whether the U.S.-Mexican deal might form the basis of a three-nation pact.

“But we know Canada’s interests are what we have to stand up for ... we are looking for the right deal, not just for Canada but for the United States,” he said at an event hosted by the Council on Foreign Relations in New York.

The United States and Canada are divided over the best way to resolve trade disputes and on a U.S. demand for more access to Canada’s protected dairy market.

Canada has also made clear that the United States needs to withdraw the threat of auto tariffs for a deal to be possible, say officials.