The Conservative government's overhaul of the temporary foreign worker program is on a collision course with its ambitious plans to sign trade deals that would allow more foreign workers to enter Canada hassle-free.

(What is the Temporary Foreign Worker Program? Read The Globe's easy explanation)

Trade negotiations have become a constant focus for Prime Minister Stephen Harper. His message: Canada must expand foreign markets for Canadian goods and services in an effort to reduce an overwhelming economic dependence on the United States.

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The final text of the much-vaunted Canada-European Union free trade agreement (CETA) is expected to include a list of occupations that can be fast-tracked into Canada and would allow European firms to bring European workers into Canada through inter-company transfers, with reciprocity for Canadian firms. The Conservative government has described the deal's provisions for temporary entry of labour as "the most ambitious ever in a free trade agreement."

Also on the horizon is a long-promised free-trade deal with India. But issues around temporary foreign workers are among the main reasons no deal has been reached. The Conservative government had promised to complete a deal in 2013.

While discussions have also been delayed in part because of India's lengthy election cycle, the fact that foreign workers have emerged as a potential stumbling block has implications for other lucrative trade agreements that Canada hopes to realize. It remains to be seen whether the resounding victory by Narendra Modi, a pro-business Hindu nationalist who heads the Bharatiya Janata Party, will help Canada overcome the impasse.

Rentala Chandrashekhar, the president of the National Association of Software and Service Companies (NASSCOM), which represents India's IT community, recently visited Ottawa to stress the negative impact Canada's reforms are having on trade and the potential that further changes could make things worse for both economies.

Mr. Chandrashekhar, a former senior public servant with the Indian government, met with Immigration Minister Chris Alexander, senior officials with Employment Minister Jason Kenney's department and Don Stephenson, the chief trade negotiator for the Canada-India talks.

"Most important is perception, the perception that the Canadian economy is becoming more closed," Mr. Chandrashekhar told the Globe. "The perception that walls are being put up … [This] is not something that is very conductive to the kind of environment that you need for pushing forward the idea of a freer trade regime."

By following the pattern of existing trade deals such as the North American Free Trade Agreement, these deals allow employers to completely bypass the Labour Market Opinion (LMO) screening process meant to ensure Canadians are given the first opportunity before temporary foreign workers are hired.

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These negotiations are occurring at a time when the government says it is already reducing the number of temporary foreign workers through new fees and tighter rules imposed last year and that more restrictions are imminent. The government is responding to controversies about lower-skilled restaurant jobs, but potential moves such as higher application fees would also affect employers looking for high-skilled workers.

"It's hypocritical," said Cobus Kriek, a Regulated Canadian Immigration Consultant who helps companies bring in foreign workers. Mr. Kriek said that while an increase in foreign workers would boost business for lawyers such as himself, he said it is not good policy to allow employers to bypass the existing LMO screening process through trade deals.

It was controversy related to temporary information technology workers from India that first brought the foreign worker program under political scrutiny in 2013. Last April, the Royal Bank of Canada issued a public apology in response to stories that Canadian jobs were being outsourced to iGate Corp., a U.S.-based company that operates primarily in India.

Largely in response to that issue, the federal government suspended a fast-track option last year for bringing in temporary foreign workers.

But Mr. Chandrashekhar said Canadian firms need to outsource IT work when specific skills are in short supply. If Ottawa puts up barriers to performing that work on Canadian soil, it will either not get done or the work will be done offshore. He said neither option is good for the Canadian economy.

It is a message that has the support of Canada's IT sector.

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Lynda Leonard, senior vice-president of the Information Technology Association of Canada, said the country has "grown up and out" of the practice of talking about protectionism for goods. "As we move into kind of a global service economy, we need to adopt a similar attitude to the global labour market," she said.

Shannon Gutoskie, a spokesperson for Conservative Trade Minister Ed Fast, said temporary entry provisions in trade deals provide predictable access for business people in a manner that enhances competitiveness and creates jobs for Canadians.

"In the negotiation of international trade agreements, including the CETA, Canada is committed to maintaining the integrity of the domestic labour market and as always, defend and promote Canada's interests," she said in an e-mail.

Editor's note: A previous version of this article incorrectly identified Cobus Kriek as an immigration lawyer. In fact, he is a Regulated Canadian Immigration Consultant.