The US Embassy denied reports that Ambassador Eric Garcetti had warned staff that they may have to cut back interactions with Indian government officials unless the row with Canada is sorted out swiftly.

The report in Washington-based publication Politico quoted Garcetti as telling his top team relations between India and the US might get worse for a time. An unnamed State Department official had said, “Garcetti also has said the US may need to reduce its contact with Indian officials for an undefined period of time.” Politico noted that it had received no official confirmation about this.

The Politico report immediately triggered speculation in some political and diplomatic circles that the leaked story was a calculated but indirect warning to India that it should settle its differences with Canada swiftly over Ottawa’s allegations that Indian agents may have killed vocal Sikh separatist Hardeep Singh Nijjar. Indian diplomats, however, quickly dismissed such speculation.

The US government’s denial came on a day when India’s official spokesperson Arindam Bagchi confirmed that India wanted Canada to cut back its diplomatic staff so that there was parity with Indian staffing at its missions in Canada.

At a briefing Bagchi clarified what the government wanted, saying, “We are looking at parity.” He added: “We are looking at the fact that there has been interference and there have been a much higher number of Canadian diplomats here and hence those discussions on achieving parity are ongoing.”

India wants Canada to cut its diplomatic staff by around 40 from 62. Canada’s staff is much bigger than India’s to handle the flood of Indian citizens seeking visas to visit relatives and friends in Canada and to attend Canadian universities. A reduction in Canada’s diplomatic staff would seriously slow the High Commission’s ability to process visas. India already has suspended its visa services to Canadians, citing threats to the safety of its diplomats.

Since Prime Minister Justin Trudeau made his bombshell claim in parliament, he has repeatedly insisted that he doesn’t wish to escalate tensions with India. He says he is only asking India to cooperate with the Canadian investigation into the June murder of Nijjar by at two gunmen who pumped 34 bullets into his body.

The Indian government has responded by calling the Canadian accusations of complicity in Nijjar’s killing “absurd.” But it says it will look at any evidence that Canada does produce.