Key Points
- 1.053 million work permits expired by end of 2025, 927,000 more set to expire in 2026, mostly held by Indian nationals
- Canada’s temporary resident reduction target of 43% leaves limited pathways to permanent residency
- Over 300,000 permits expire in Q1 2026 alone, creating unprecedented “out of status” crisis
- Tent colonies have emerged in Brampton and Caledon forests as migrants lose housing and work rights
- Fake marriage gangs exploiting desperate migrants, charging up to CAD 50,000 for fraudulent PR arrangements
- Youth Support Network planning nationwide protests in January 2026 with slogan “Good enough to work, good enough to stay”
- Three-year PGWP holders from 2022-23 face mass expiry with no LMIA-supported job offers required for renewal
The coming period is set to be extremely challenging for millions of Indian immigrants living in Canada, as their legal status is under threat due to stringent changes in immigration policies. According to reports from experts and immigration consultants, approximately one million Indian citizens could lose their legal status by mid-2026, rendering them undocumented immigrants. This unprecedented situation stems from the mass expiry of work and study permits combined with severely restricted pathways to permanent residency, creating what experts call Canada’s largest immigration crisis in modern history.
The primary reason for this humanitarian emergency is the convergence of two factors: the natural expiry cycle of post-graduation work permits (PGWPs) issued during 2022-2023 and the Trudeau government’s aggressive policy shift to curb temporary residents. Immigration experts warn that this is the first time Canada faces such a large-scale simultaneous “out of status” scenario, with devastating consequences for both migrants and the Canadian economy.
The Numbers Behind the Crisis
Latest data from Immigration, Refugees and Citizenship Canada (IRCC) reveals the staggering scale of the problem. Approximately 1.053 million work permits expired by the end of 2025, and another 927,000 permits are set to expire in 2026. According to immigration expert Kanwar Sierah, this represents the first time in Canadian history that such a large number of people are on the verge of becoming “out of status” simultaneously. The expiry of over 300,000 permits in the first quarter of 2026 alone is expected to create a major bottleneck in the entire immigration system.
Indian nationals constitute the largest demographic affected, representing nearly 40% of all temporary residents in Canada. The crisis particularly impacts students who arrived during 2020-2022, when Canada aggressively recruited international students to fill labor shortages. Many of these individuals have built lives in Canada, purchasing homes, starting families, and integrating into communities, only to find their legal status evaporating with limited recourse.
Government’s Stringent New Policies
Given the housing crisis, increasing pressure on healthcare services, and infrastructure limitations, the Justin Trudeau government has set a target of reducing the number of temporary residents by up to 43% by 2027. The government has also halved the number of international student permits and implemented new rules to control asylum applications. These measures include stricter Labour Market Impact Assessment (LMIA) requirements, caps on provincial nominee programs, and the elimination of many COVID-era permit extension policies.
These stringent measures are leaving many young Indians, who have been hoping for PR for years, with no option but to return home or live illegally in Canada. The federal government’s recent decision to limit PGWP eligibility to only certain high-demand fields has further narrowed pathways, leaving thousands of business, arts, and general science graduates without viable immigration options.
Human Cost: Tent Colonies and Underground Economy
The social impact of losing legal status is now clearly visible in the Greater Toronto Area, where migrants have set up tent colonies in the forests of cities like Brampton and Caledon. These makeshift settlements house individuals who have lost rental accommodations after their work permits expired, as landlords increasingly require valid status documentation. Many migrants of Indian origin are now forced to work for cash to avoid being caught, which paves the way for their exploitation.
According to some local reports, gangs involved in arranging fake marriages to obtain legal status have also become active, further exacerbating the seriousness of the situation. These criminal networks charge desperate migrants between CAD 30,000 to 50,000 for fraudulent marriage arrangements, often leaving them vulnerable to blackmail and legal prosecution. Social workers report increased cases of mental health crises, with suicide prevention hotlines receiving record calls from affected Indian migrants.
Community Mobilization and Protests
The labor rights group ‘Youth Support Network’ is planning large-scale protests in January 2026 to highlight the plight of these workers. Activist Bikramjit Singh says that those who are contributing to the Canadian economy should be given the legal right to reside in the country. The organization has scheduled demonstrations in Toronto, Vancouver, Calgary, and Winnipeg, expecting participation from over 50,000 affected migrants and their supporters.
The organization’s slogan, “Good enough to work, good enough to stay,” is becoming quite popular among migrants, and they are demanding relief from the government on humanitarian grounds. The movement has gained support from Canadian labor unions, business councils, and opposition parties, who argue that deporting experienced workers would harm economic growth. Over 200 Canadian employers have signed petitions requesting status regularization for their long-term temporary workers.
Economic Implications and Labor Market Disruption
Experts believe that if the government does not find a middle ground soon, such a large number of undocumented individuals could destabilize the labor market. Because they are undocumented, these people will neither be able to pay taxes nor avail themselves of official health services, increasing the risk of crime and insecurity. Key sectors like IT, healthcare, construction, and hospitality face severe worker shortages if experienced Indian professionals are forced to leave.
The Conference Board of Canada estimates that losing 500,000 temporary workers could reduce GDP growth by 0.8% in 2026. Undocumented workers cannot access employment insurance, workers’ compensation, or legal recourse against exploitation, creating a shadow economy that undermines labor standards for all workers. This is proving to be a very difficult test for the Canadian government, balancing the need to maintain a balanced immigration system and protecting its international image as a welcoming nation.
Latest Updates and Government Response
As of January 2026, the IRCC has announced a temporary 90-day “consideration period” for certain PGWP holders, but this falls far short of the comprehensive regularization program advocates demand. Immigration Minister Marc Miller has indicated that targeted pilots for specific sectors may be announced, but maintains that the overall reduction target remains firm. Meanwhile, Indian consulates in Toronto and Vancouver have established dedicated helplines and are organizing repatriation assistance for those choosing to return voluntarily.
The crisis has strained Canada-India diplomatic relations, with India’s External Affairs Ministry formally raising concerns about the welfare of its citizens. Community leaders are calling for an emergency bilateral dialogue to create structured pathways for status regularization, similar to programs offered during previous immigration transitions in the United States and Europe.
