NEW DELHI: India characterised as "absurd and motivated" an accusation by Canada that it was involved in the murder of a Sikh separatist leader, urging the country instead to take legal action against anti-Indian elements operating from its soil.

Canada was "actively pursuing credible allegations" linking Indian government agents to the murder of Sikh separatist leader Hardeep Singh Nijjar, Prime Minister Justin Trudeau told the House of Commons on Monday.

Nijjar, who was shot dead outside a Sikh temple in June, had been designated a "terrorist" by India in July 2020, following his support for a Sikh homeland in the form of an independent state of Khalistan.

"Similar allegations were made by the Canadian prime minister to our prime minister, and were completely rejected," the Indian foreign ministry said on Tuesday.

"We urge the government of Canada to take prompt and effective legal action against all anti-India elements operating from their soil," the ministry added in a statement.

Such "unsubstantiated allegations" sought to shift the focus away from "Khalistani terrorists and extremists who have been provided shelter in Canada", it said.

Sympathy expressed for such individuals by Canadian political figures was a "matter of deep concern", it added.

Canada also expelled India's top intelligence agent in the country on Monday.

Canada has the largest population of Sikhs outside the Indian state of Punjab, with about 770,000 people reporting Sikhism as their religion in the 2021 census.

Khalistan is an independent Sikh state whose creation has been sought for many years.