There is a delicious irony in visiting Australian Prime Minister Anthony Albanese declaring on 9 March that India was “at the heart of Australia’s approach to the Indo-Pacific and beyond." Standing on the deck of INS Vikrant, he said New Delhi was a “top tier security partner” of Canberra.
There was a shade of irony too when he announced that Australia would host the Malabar exercise for the first time this year.
Prime Minister Anthony Albanese announced that Australia would host the Malabar exercise for the first time in 2023.
It began with Canberra taking a tough line on Chinese claims in the South China Sea in 2016 and not surprisingly, it paralleled the US-China estrangement.
Following the Ladakh events, New Delhi quickly shifted tracks and reached out to Canberra lifting its objections to its participation in the Malabar Exercise.
The political relationship, too, has grown. In June 2020, the India-Australia relationship was upgraded to a “Comprehensive Strategic Partnership” and the two countries initiated the system of annual leader-level summits.
The architecture of the Indo-Pacific relationship is still evolving, just as is the relationship between the two countries.
The Roadblocks in India-Australia Strategic Partnership
It was only in 2020, that India finally agreed after repeated Australian requests to participate in the exercises which were conducted by the US, India, and Japan. In 2008, the Rudd government of Australia had announced that it would not participate in the exercises because of concerns over the Chinese reaction.
In the 1990s, Australia saw things differently as characterised by two incidents. The first one in 1993, an Australian naval aircraft overflew, and presumably photographed INS Viraat, the Indian aircraft carrier. Then, during the visit of the Australian CDS Admiral Chris Barrie to New Delhi in 1997, an Australian maritime surveillance aircraft dropped sonar buoys around the Indian destroyer INS Delhi with a view of recording its magnetic signature. All this was topped off by an uncommonly harsh Australian response to the Indian nuclear weapons test in 1998.
Positioned where it is abutting the Southeastern Indian Ocean, Australia also saw itself as a major security player in the region. But, nestling under the US nuclear umbrella, Australia did not quite like the idea of the emergence of India as a major regional power.
But once the US made up with India following the Indo-US nuclear deal, the Australians fell in line. The result of this was the 2006 Memorandum on Defence Cooperation and the 2009 Joint Declaration on Security Cooperation.
But China was increasingly in Canberra’s mind. This led to its decision to walk out of the Quad in 2007 and terminate its participation in Malabar the next year. In 2012, a major irritant was removed when Prime Minister Julia Gillard visited India and agreed to open negotiations on the export of Uranium to India which was finally clinched when her successor visited India in 2014. When Modi visited the country in the same year, it was the first visit by an Indian PM since 1986.
Proximity With China Turned to Turbulent Ties
By 2011, China- Australia trade had grown to USD 114 billion. Along with trade came Chinese tourists, making them the highest source of tourist income.
Another component was students and in 2011-12, some 50,000 student visas were issued to the Chinese as compared to 34,000 for Indians. This also led to a closer relationship between Australian and Chinese institutions and there were even plans to teach Mandarin in Australian schools.
Chinese investment in Australia began to grow and relations peaked in 2014 when Xi Jinping addressed a joint sitting of both houses of the Australian Parliament.
However, all that is now history.
It began with Canberra taking a tough line on Chinese claims in the South China Sea in 2016 and not surprisingly, it paralleled the US-China estrangement. The second was Australia’s decision to participate in the revived Quad in 2017.
The third shot was fired when Australia became the first country in the world to ban Huawei from its telecom networks, setting a precedent that that other countries including the US and India followed. Beijing has not forgotten this and holds special grudge against Canberra for the action.
Soon, the Australians began to worry about the influence operations of the Chinese in Australia, including the potential use of money to influence legislators. Worse, they were alarmed about backdoors in Chinese telecom equipment that Australia had been importing for years. There were concerns, too, over the rising Chinese investment in the country.
Beijing's Embargo On Australian Goods
Along with this came the Australian criticism of China’s Xinjiang and Hong Kong policies. All this was capped by Australia’s support or an “independent inquiry” into the origins of Covid 19 in 2020, the year in which China-US relations also went south.
This triggered enormous anger in Beijing which promptly banned the import of Australian beef which had till then constituted 35 per cent of Australia’s beef exports. This was followed up by additional tariffs on barley and wine and by the end of the year, China blocked all coal imports from Australia.
2020, of course, was also the year when the Chinese established blockades along the LAC in Ladakh and massed its forces in Tibet in contravention of various agreements.
India had apparently mended its fences with China after the Doklam standoff in 2017. The two sides expended a great deal of political capital in successive leadership summits in Wuhan and Chennai in 2018 and 2019. But following the Ladakh events, New Delhi quickly shifted tracks and reached out to Canberra lifting its objections to its participation in the Malabar Exercise.
Suddenly things fell into place, India and Australia rediscovered each other. The Albanese visit with its somewhat over-the-top tenor is a culmination of sorts. For the ridiculous spectacle at the Narendra Modi stadium, you can probably hold Modi’s persona to account. But the Aussies must ask themselves why they agreed to a visit in the midst of a major Indian festival of Holi.
With China Factor in the Mix, Will India-Australia Equation Improve?
An important component of the relationship is economic. With a population of just 25 million, Australia’s GDP of USD 1.72 trillion is just about half of India. Australia and India entered into an Economic Cooperation and Trade Agreement in April 2022 which came into force by the end of the year.
India is hoping to replace China as a major supplier of manufactured goods in exchange for Australian commodity exports. All these also tie into India’s commitments to the Trilateral Supply Chain Resilience Initiative and the Indo-Pacific Economic Forum. But the two have a long way to go.
As of 2021, bilateral trade is USD 27.5 billion and Australia is the 17th largest trade partner of India while India is Australia’s 9th largest trade partner. If things go well, they can hope to hit USD 50 billion in five years.
The Albanese visit has led to an agreement to work on a Comprehensive Economic Cooperation Agreement (CECA) between the two countries and target USD 100 billion trade between the two economies.
The political relationship, too, has grown. In June 2020, the India-Australia relationship was upgraded to a “Comprehensive Strategic Partnership” and the two countries initiated the system of annual leader-level summits. Albanese's current visit was, however, the first in-person summit since then. In September 2021 in New Delhi, the two also upgraded their ministerial contacts by instituting “2+2” meetings of their Defence and Foreign Ministers.
There is also the important people-to-people connect arising from the Indian diaspora now some 780,000 strong and second only in size to the British. They are largely young and highly educated and many work in the IT area.
The Indians assimilate easily adjusting to Australian culture where many other diasporas find it difficult. In 2006, the Howard government had opened the doors to Indian students and they have now been coming in increasing numbers to the country.
Now the potential irritants in India-Australia relations stem from their geopolitical asymmetry. India is a major regional power in terms of its economy and military heft. Australia depends on the US for its security and is a time-tested ally of Washington having participated in many of its wars, such as those in Vietnam, Iraq, and Afghanistan. Many view Australia as a kind of Deputy Sheriff to the US while India has so far stayed away from any involvement in a US military venture.
But the architecture of the Indo-Pacific relationship is still evolving, just as is the relationship between the two countries. It could well feature an Indo-Australian collaboration in the eastern Indian Ocean, even while Canberra enhances its partnership with the US in the western Pacific through the AUKUS alliance.
The writer is a Distinguished Fellow, Observer Research Foundation, New Delhi.