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Indo-Pacific Partners: Australia and India in the 21st Century

Prof. Ian Hall

Griffith Asia Institute

For about hundred and fifty years after the establishment of a penal colony in what is now Sydney, Australia and India were closely connected parts of the British Empire. The East India Company controlled shipping to and from the new settlement. For their part, Australians helped sustain the British Indian army, breeding and supplying horses. In the 1830s, Indian indentured workers migrated to Australia to work as sugar cane cutters and tend sheep. Later that century, more Indians – including Punjabi Sikhs, as well as Afghans – travelled out to manage the camel trains that moved across Australia carrying wool and other goods. Further immigration was restricted after 1901 by the so-called “White Australia Policy” but commercial and financial traffic between the two integral parts of the Empire continued.

Between 1947 and the end of twentieth century, however, Australia and India drifted further and further apart. Cricketing contests and the British Commonwealth kept the two countries tethered to one another, but neither guaranteed good relations. Indeed, Australia and India clashed repeatedly, in both contexts, and others. Canberra did not approve of India’s nonalignment; New Delhi was not keen on alliances, including Australia’s close security partnership with the United States (US). The White Australia Policy remained an irritant until it was dismantled in the early 1970s and so too – for longer – was India’s strident criticism of apartheid South Africa. Australia’s involvement in the Vietnam war attracted India’s ire and Indira Gandhi’s tilt towards the Soviet Union upset Canberra. In the 1980s, bilateral relations improved a little, but India’s economic protectionism and opposition to the Nuclear Non-Proliferation Treaty continued to bother Australia’s leaders. Efforts to revive the relationship after the Cold War were made by both Canberra and New Delhi, but then came the nuclear weapons tests in 1998, which prompted an angry response from Australia that was not well-received in India.[1]

Remarkably, a robust strategic partnership has been built between Australia and India in the two decades since that low point in bilateral relations. Mutual apprehension about China’s growing assertiveness has spurred the two to talk and to cooperate, leading to closer defence and security ties. The partnership has also been assisted by stronger people-to-people connections resulting from a new wave of Indian migration into Australia, as well as by diplomatic activism by successive governments in both Canberra and New Delhi. And we have seen progress in expanding bilateral trade and investment, leading to the recent conclusion of an “early harvest” economic agreement, signed in early April 2022.[2]

Picture for representational purpose only. Source: Observer Research Foundation, New Delhi

Underpinning this partnership is a far greater appreciation in both Australia and India than existed twenty years ago of each other’s interests and the ways in which both countries can collaborate for mutual gain. Australia and India share deep concerns about China’s unclear intentions and troubling behaviour. Both worry about whether Beijing might disrupt freedom of navigation and undermine maritime security in the South China Sea and the Indian Ocean. For that reason, Canberra and New Delhi now carry out joint exercises with their navies and with the Boeing P-8 maritime patrol aircraft that both countries operate.[3] Australia and India also worry about the diplomatic leverage China’s trade and infrastructure financing now gives Beijing throughout the Indo-Pacific, and about the possibility that China will seek to dominate key high-technology sectors, such as quantum computing, microchips, and lithium-ion batteries. In response, Australia and India are working bilaterally and within the Quad grouping, which also includes Japan and the US, to retain a technological edge and build resilience in those areas.[4]

In parallel, Australia and India are aiming to strengthen their economic relationship, as both seek to lessen dependence on China for exports, imports, and capital, and to reconstruct supply chains. The recently concluded Economic Cooperation and Trade Agreement (ECTA) is one instrument for achieving those goals, but there are others, including the trilateral Supply Chain Resilience Initiative, which also involved Japan. Whether these will pay significant dividends is not yet clear, partly because the effects of Covid-19 related disruptions are still being felt. The value of bilateral trade between Australia and India has grown, hitting A$24.3bn (about US$15.6bn) in 2020, thanks mainly to greater numbers of Indian students accessing Australian education providers.[5] It is hoped that ECTA tariff reductions for Australian commodities like coal, meat, wool, and a range of fruits, vegetables, and pulses, will lead to further growth. Indian producers will look to export more textiles, leather goods, jewellery, medical devices, and pharmaceutical goods to Australia.[6] It is unlikely, however, that these measures will lift the Australia-India economic relationship to the levels both countries experience with China. In 2020, Australia-China two-way trade was valued at A$245bn (about US$157bn) and India-China trade at US87.6bn.[7] In both cases, there are complementarities that cannot be replicated elsewhere: China remains hungry for Australia’s coal and iron ore, while Indian demand for Chinese-manufactured electronics and other consumer goods remains strong.

There is nevertheless a clear sense in both Australia and India that economic ties will get stronger over time. Better people-to-people ties will play a major role here, as well as efforts to build connections between universities and other institutions. Very few Indians visited or emigrated to Australia prior to 2000. In 2019, however, almost 400,000 Indian tourists arrived at Australia airports, a figure 234% higher than it was in 2009.[8] In 2021, it was estimated that 700,000 people of Indian origin had settled in Australia, making the diaspora one of the largest in the country.[9] Fewer Australians travelled in the opposite direction, but there have been positive developments. In 2019, for example, almost 1300 Australians spent time in India under the Australian government’s New Colombo Plan, which is designed to facilitate short term visits for about 10,000 higher education students.[10] The new “Maitri” scholarships and fellowships will offer Indians similar opportunities to study in Australia.[11] On the Australian side, at least, work is being done to try to translate these new links into business opportunities and institutional collaborations. Canberra will soon establish a Centre for Australia-India Relations that aims to engage the diaspora, businesses, and cultural groups to build those connections.[12]

PM Modi met his newely elected counterpart on the sidelines of the Quad Leaders Summit,2022 in Tokyo. Source : Indian Express

In the short term, however, it is on the defence and security side that more progress will likely be made in advancing the partnership. We should expect more deployments of Australian and India ships and aircraft to each other’s bases, as both countries focus on the honing their submarine- and ship-hunting skills. The new General Rawat India-Australia Young Defence Officer Exchange Programme will improve mutual understanding of common security challenges. Defence industrial cooperation will also intensify, as India reduces its dependence on Russia-made equipment and builds the capacity to make arms indigenously.[13] And it is possible that India may purchase some of the niche systems Australia can supply, like specialised armoured vehicles, or work with Australia on novel technologies, like autonomous underwater vehicles.[14]

It should be observed that none of these things would be possible without the trust and understanding built up over twenty or so years of patient diplomacy, backed by political will. Australia and India are not obvious partners in the way that India and the US – or even Japan - clearly are. Australia is a small and geographically peripheral country with a population smaller than greater Delhi. It is relatively wealthy and has a relatively capable military, but its strengths and weaknesses in both areas do not complement India’s in many areas. Australia is a free-trading commodity producer, service provider, and maritime power. India is more protectionist, while its geography and history have shaped a strategic culture that emphasises the need to invest far more heavily in armies than navies. They both face, however, a common challenge in China – specifically in Beijing’s apparent desire to establish an Indo-Pacific sphere of influence. In such an order, China would not simply bend the regional economy to serve its own development needs: Beijing would also curb the sovereign autonomy of other states, to ensure those needs were met and the Communist Party remains in absolute control.[15] None of this would serve Australia or India well, so finding ways to work together, as strategic partners, to steer the region towards a more balanced, multipolar future, will and should remain a key task for both countries for some time to come.

[1] On the history of the bilateral relationship, see especially Meg Gurry, Australia and India: Mapping the Journey, 1944-2014 (Carlton, VIC: Melbourne University Press, 2015), as well as Peter Mayer and Purnendra Jain, “Beyond Cricket: Australia-India Evolving Relations,” Australian Journal of Political Science 45, no. 1 (2010): 133-148. [2] Kallol Bhattacherjee, “The India-Australia trade agreement”, The Hindu, 5 April 2022, [3] “India deploys P-8 in joint exercise with RAAF”, Asia-Pacific Defence Reporter, 14 April 2022, A bilateral naval exercise, dubbed AUSINDEX, was first held in 2015. For background, see Dhruva Jaishankar, The Australia-India Strategic Partnership: Accelerating Security Cooperation in the Indo-Pacific (Sydney: Lowy Institute for International Policy, 2020), [4] Arjun Gargeyas, “Why India-Australia technology cooperation is a welcome development: A new technology alliance?”, Policy Forum, 24 January 2022, [5] Department of Foreign Affairs and Trade, India Country Brief, [6] Abhijit Mukhopadhyay and Premesha Saha, India-Australia trade ties: Negotiating a Comprehensive Economic Cooperation Agreement, Observer Research Foundation, 12 May 2022, [7] Department of Foreign Affairs and Trade, China Country Brief,; Ananth Krishnan, “India-China trade crossed $125 bn in 2021”, The Hindu, 15 January 2022, [8] Australian Bureau of Statistics, Overseas Arrivals and Departures, Australia, 16 March 2020, [9] Aarti Betigeri, “Indians are becoming visible in Australia like never before”, The Interpreter, 28 May 2021, [10] PTI, “India among most popular destination for Aus students under New Colombo Plan”, Business Standard, 24 July 2018, [11] Department of Foreign Affairs and Trade, “Strengthening our ties with India”, 15 February 2022, [12] Department of Foreign Affairs and Trade, “Centre for Australia-India Relations”, 22 March 2022, [13] Pradeep S Mehta and Sandra George, “Defence cooperation hardens the India–Australia relationship”, East Asia Forum, 13 May 2022, [14] Troy Lee-Brown, “War in Ukraine provides opportunities for deepening Australia–India defence cooperation”, The Strategist, 25 March 2022, [15] Rory Medcalf, Contest for the Indo-Pacific: Why China Won't Map the Future (Melbourne: Black Inc., 2020).

About the author

Ian Hall is a Professor of International Relations and the Deputy Director (Research) at the Griffith Asia Institute at Griffith University, Brisbane, Australia. He is also an Academic Fellow of the Australia India Institute in Melbourne. His research focuses on India’s foreign and security policy, and Indo-Pacific affairs. Views expressed are personal.

The piece originally appeared as the cover story in the inaugural issue of the Ytharth Magazine . E-copy of the magazine can be downloaded from here.

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