India and Canada each expelled the other's ambassador and five other top diplomats, after New Delhi said its envoy had been named among "persons of interest" following the killing of a Sikh separatist leader.

New Delhi said it was withdrawing its six diplomats from Canada, but Ottawa said it had served them notices of expulsion.

"Subsequent to those notices, India announced it would withdraw its officials," a statement from the Canadian foreign ministry said.

The 2023 murder of Canadian citizen Hardeep Singh Nijjar crashed the country's diplomatic relations with India after Prime Minister Justin Trudeau said there were "credible allegations" linking Indian intelligence services to the crime.

The expulsion of the diplomats -- including the most senior envoys on both sides -- is a major escalation in the row.

India "decided to expel" Ottawa's acting High Commissioner Stewart Wheeler, his deputy and four first secretaries, ordering they leave before midnight on Sunday.

Ottawa announced similar measures in return, with Canadian police saying they had "evidence pertaining to agents of the government of India's involvement in serious criminal activity" in Canada.

Canadian Foreign Minister Melanie Joly said that India had refused to cooperate in the investigation, or to lift diplomatic immunity for its envoys.

"The decision to expel these individuals was made with great consideration and only after the RCMP gathered ample, clear and concrete evidence which identified six individuals as persons of interest in the Nijjar case," she said in a statement, referring to the Royal Canadian Mounted Police.

Nijjar -- who immigrated to Canada in 1997 and became a citizen in 2015 -- had advocated for a separate Sikh state, known as Khalistan, carved out of India.

He had been wanted by Indian authorities for alleged terrorism and conspiracy to commit murder.

Four Indian nationals have been arrested in connection with Nijjar's murder, which took place in the parking lot of a Sikh temple in Vancouver in June 2023. (AFP)