- Brief intro on growing Indo-Australia relation.
- Discuss the potential domains of cooperation.
India and Australia are rapidly becoming natural partners in the Indo-Pacific. The recent signing of Economic Cooperation and Trade Agreement (ECTA) is a significant step in that rapid deepening of bilateral ties. The Indian PM has termed the signing of ECTA as a ‘watershed moment’.
It is a watershed moment due to a complete transformation of the bilateral relationship, which is seen in the context of its larger foreign & economic policy objectives.
Within the Quad:
- India & Australia are members of the Quad. For the longest time, both were reluctant in joining Quad, worrying about the impact it could have on their respective relations with China. However, both countries have shed their ambivalence in recent times. The Quad is seen not to be a military alliance, but an economical & technological partnership. This can lend clues on where the Indo-Australia relationship is headed.
- While India has substantial economic ties with Japan & US, no such economic pillar underlay the Indo-Australia relationship. The ECTA is an important step in ramping up economic ties between both countries. It targets doubling the bilateral trade to $ 50 billion in 5 years from $ 27.5 billion in 2021. The ECTA is also indicative of the growing strategic significance.
- India has agreed to allow duty-free entry of 85% Australian goods exports by value and within next 10 years cut tariffs to zero on another 5% Australian merchandise.
- Australia is becoming an important global player testified by Biden’s statement “the US has no closer or more reliable ally than Australia”. There are various reasons behind Australia’s rise on the global stage that India can use to its leverage –
- strategically located in the Indo-Pacific. If any conflict occur over the Taiwan Strait, the presence of Australia in the south of the region will perfectly complement the presence of Japan in the north. This also explains creation of the newest military alliance in the region, i.e., AUKUS.
- Australia has a massive reserves of rare-earths, which are critical elements in the global supply chain for semiconductors. This is one of the main technological dimensions of the growing closeness between India & Australia. As India is attempting to build its own semiconductor industry, it needs access to reliable, secure source of rare earths.
- Cooperation in cyber security & intelligence sharing are likely to be the key focus areas.
- With the easy flow of talent, a large number of Indian students are studying in Australia. Canberra has agreed to ease visa restrictions enabling students to stay & work from 18 months up to 4 years.
Strategically, Australia & India will need to come even closer if they are to form the eastern & western flanks of an open, free, stable and multi-polar Indo-Pacific. A pragmatic outlook is need to resolve more contentious issues like, in dairy sector, politically significant export industry, bilateral trade in services, etc.