INDIA-AUSTRALIA BILATERAL RELATIONS

INDIA-AUSTRALIA BILATERAL RELATIONS

 

Basic and Backgrounds

 

  • The India-Australia bilateral relationship has undergone evolution in recent years, developing along a positive track, into a strategic partnership.
  • The two nations have much in common, underpinned by shared values of a pluralistic, Westminster-style democracies, Commonwealth traditions, expanding economic engagement and increasing high level interaction.
  • The historical ties between India and Australia started immediately following European settlement in Australia from 1788. All trade to and fro from the penal colony of New South Wales was controlled by the British East India Company through Kolkata.
  • India and Australia established diplomatic relations in the pre-Independence period, with the establishment of India Trade Office in Sydney in 1941.
  • The end of the Cold War and simultaneously India’s decision to launch major economic reforms in 1991 provided the first positive move towards development of closer ties between the two nations. With the passage of time, the relationship gained momentum towards a strategic relationship, alongside the existing economic engagement.
  • India-Australia Strategic Relationship: With the changing global scenario, Australia has come to look at India as an important partner in promoting regional security and stability. This led to up gradation of bilateral relationship to a ‘Strategic Partnership’, including a Joint Declaration on Security Cooperation in 2009. Over the years an array of institutional mechanism has been put in place to promote bilateral co-operation.
  • Bilateral mechanisms include high level visits, Annual Meetings of Prime Ministers, Foreign Ministers’ Framework Dialogue, Joint Trade & Commerce Ministerial Commission, India-Australia ‘2+2’ Foreign Secretaries and Defence Secretaries Dialogue, Defence Policy Talks, Australia-India Education Council, Defence Services Staff Talks, Energy Security Dialogue, JWGs on different issues etc.
  • Australia’s White Paper on Foreign Policy released in November 2017 sees India in the front rank of Australia’s international partnerships. It says, “Beyond an increasingly important economic relationship, our security interests are congruent, particularly in relation to the stability and openness of the Indian Ocean. Both the countries have common interests in upholding international law, especially in relation to freedom of navigation and maritime security”.

 

Political
  • The two-way Prime Ministerial visits in 2014 built significant momentum in the bilateral relationship, signifying deepening relations.
  • India-Australia ‘2+2’ Foreign Secretaries and Defence Secretaries Dialogue: India and Australia agreed in 2015 to hold annual meetings of Foreign and Defence Secretaries (2+2) to enhance foreign policy and security cooperation; The 3rd Dialogue was held in New Delhi on 09 December 2019.
  • India-Australia-Japan Trilateral Dialogue: The inaugural Secretary-level trilateral talks between India, Australia and Japan was held in New Delhi in June 2015. The second Foreign Secretary level trilateral talks were held in Tokyo on 26 February 2016 and the third took place in Canberra on 29 April 2017. The 4th India-Australia-Japan Trilateral Dialogue was held in New Delhi on 13 December 2017.
  • Indonesia-Australia-India Trilateral Dialogue: The 1st Indonesia-Australia-India Senior Officials’ Strategic Dialogue was held in Bogor, Indonesia on 27th November 2017. The second dialogue in Canberra on September 21, 2018 and the 3rd in New Delhi on 19 November 2019.

 

Bilateral Economic and Trade Relationship
  • The India-Australia economic relationship has grown significantly in recent years.
  • As part of its efforts to develop strong economic relationship with India, the Australian side accepted some recommendations of the India Economic Strategy, prepared by Australian Think Tank, to define a pathway for Australia to unlock opportunities offered by Indian Economic growth.
  • The strategy aims for a clear exposition of the kind of relationship Australia should aspire to have with India out to 2035. The paper was released on July 12, 2018. The Paper identifies ten key sectors (Education as flagship sector; Agribusiness, Resources and Tourism as lead sectors; Energy, Health, Financial Services, Infrastructure, Sports, Science & Innovation as Promising Sectors) and ten states in India (Andhra Pradesh, Delhi NCR, Gujarat, Karnataka, Maharashtra, Punjab, Tamil Nadu, Telangana, UP and West Bengal) where Australia should focus efforts.
  • India is the 5th largest trade partner of Australia with trade in goods and services  at  A$  29  billion  representing  3.6%  share  of  the  total  Australian  trade  in  2017-18,  with export at A$ 8 billion and import at A$ 21 billion.
  • India’s  main  exports  to  Australia  are  Refined  Petroleum,  medicaments, while our major imports are Coal, copper ores & concentrates, Gold, and  education related  services.

 

Civil Nuclear Cooperation
  • A Civil Nuclear Cooperation Agreement between the two countries was signed in September 2014 during the visit of the Australian Prime Minister to India. The agreement came into force from 13 November 2015.
  • The Australian Parliament passed the “Civil Nuclear Transfer to India Bill 2016” on 01 December, 2016 which ensures that Uranium mining companies in Australia may fulfil contracts to supply Australian uranium to India for civil use with confidence that exports would not be hindered by domestic legal action challenging the consistency of the safeguards applied by the IAEA in India and Australia’s international non-proliferation obligations.
  • It also ensures that any future bilateral trade in other nuclear-related material or items for civil use will also be protected.

 

Defence Cooperation
  • The Mutual Logistics Support Agreement has been signed during the summit that should enhance defence cooperation and ease the conduct of large-scale joint military exercises.
  • There is a technical Agreement on  White  Shipping Information  Exchange.
  • Recently Australia and India conducted AUSINDEX,their largest bilateral naval exercise, and there are further developments on the anvil, including Australia’s permanent inclusion in the Malabar exercise with Japan. 
  • In 2018, Indian Air Force participated for the first time in the Exercise Pitch Blackin Australia. The third edition of AUSTRAHIND(Special Forces of Army Exercise) was held in September 2018.
  • A broader maritime cooperation agreement with a focus on Maritime Domain Awareness (MDA) is also in the works and Australia has agreed to post a Liaison Officer at the Indian Navy’s Information Fusion Centre – Indian Ocean Region (IFC-IOR) at Gurugram. 

 

The Quad:

  • The informal strategic Quadrilateral Security Dialogue (QSD) that was initiated by Japan’s Prime Minister Shinzo Abe in 2007 was largely in response to China’s growing power and influence.
  • Initially, the “Quad” members included India, Japan, the US, and Australia; however Australia chose to withdraw when Kevin Rudd was Prime Minister, since it did not want to be a part of an anti-China alliance at the time.
  • However, Australia later re-joined the dialogue in 2017 on the side-lines of the ASEAN Summit, signalling a re-ignition in Australia’s interest in the dialogue.

 

Agriculture, Science and Technology
  • An Australia-India Strategic Research Fund (AISRF), which was established in 2006, supports scientists in India and Australia to collaborate on leading-edge research. AISRF consists of India Australia Biotechnology Fund; India-Australia Science & Technology Fund; Grand Challenge Fund and Fellowship Schemes.
  • The fund, where each side contributes equally, supports large-scale research projects designed to deliver practical solutions, focusing on energy, food and water security, health and the environment. Joint Committees on S&T and Biotechnology have been established to administer the Fund.
  • The Australian side is also cooperating in our Clean Ganga Project as agreed during visit of our PM to Australia in 2014.
  • Secretary (Water Resources, River Development and Ganga Rejuvenation) led a delegation to Australia during 19-25 June 2016 for bilateral cooperation on water resource management, including discussion on Ganga Rejuvenation.
  • A four-member delegation led by Shri U. P. Singh, Secretary, Ministry of Water Resources, River Development & Ganga Rejuvenation visited Canberra for attending 4th India-Australia JWG Meeting on July 11, 2018.
  • Agreement on Cyber and Cyber-Enabled Critical Technology was signed.

 

Resource and Energy Cooperation
  • A Joint Working Group on Energy and Minerals was established in 1999 to expand bilateral relationship in the energy and resources sector. The 8th JWG meeting held in New Delhi in June 2013.
  • As energy is one of the central pillars of economic cooperation, both sides agreed during the visit of our Prime Minister to Australia in November 2014 to cooperate on transfer of clean coal technology and welcomed Australia’s desire to upgrade the Indian School of Mines, Dhanbad.
  • The 9th JWG meeting in Brisbane in June 2015, provided the opportunity to discuss resources and energy policy developments and reforms, including opportunities and challenges in mining; petroleum and gas; power; new and renewable energy, as well as challenges in skills, science and innovation and infrastructure.

 

Education, Sports & Cultural Ties
  • The Joint Working Group on Education between the two countries has identified several key areas for co-operation, including collaborative research in education policy, student exchange programmes, capacity building in vocational education and distance learning in higher education.
  • Under the New Colombo Plan of Australian government, Australian undergraduates have studied and completed internships in India

 

Indian Diaspora in Australia
  • The Indian community in Australia continues to grow in size and importance, with the population of nearly seven lakhs.
  • India is one of the top sources of skilled immigrants to Australia. There is a constant flow of students and tourists from India.
  • India is now the third largest source of immigrants to Australia, after UK and New Zealand and the largest source of skilled professionals for Australia.
  • The growing significance of the community is reflected in the large-scale celebration of Indian festivals in Australia, especially Deepawali.

 

An India Economic Strategy to 2035

 

  • Australia’s Prime Minister has announced implementation of “An India Economic Strategy to 2035”, a vision document that will shape India-Australia bilateral ties.
  • It is based on three-pillar strategy- Economic ties, Geostrategic Engagement and Rethinking Culture-thrust on soft power diplomacy.
  • The focus of this report is on building a sustainable long-term India economic strategy.
  • The report identifies 10 sectors and 10 states in an evolving Indian market where Australia has competitive advantages, and where it should focus its efforts. These are divided into a flagship sector (education), three lead sectors (agribusiness, resources, and tourism) and six promising sectors (energy, health, financial services, infrastructure, sport, science and innovation).

 

Significance of Indo-Australia bilateral relations
  • Pandemic control lessons: Australia is one of the few countries that has managed to combat COVID-19 so far through “controlled adaptation” by which the coronavirus has been suppressed to very low levels. Two of the leaders of this great Australia-wide effort are Indian-born scientists.
  • Agricultural cooperation: From farming practices through food processing, supply and distribution to consumers, the Australian agribusiness sector has the research and development (R&D) capacity, experience and technical knowledge to help India’s food industry improve supply chain productivity and sustainability and meet the challenges of shifting consumption patterns.
  • Trade: Australia is the 13th largest economy in the world, following closely behind Russia which stands at $1.6 trillion.
  • Australia is rich in natural resourcesthat India’s growing economy needs.
  • It also has huge reservoirs of strength in higher education, scientific and technological research.
  • The dominance of Indo-Pacific countries in India’s trade profile: Fostering deeper integration between India and Australia will provide the necessary impetus to the immense growth potential of the trade blocs in this region.
  • Strategic:The two countries also have increasingly common military platforms as India’s defence purchases from the U.S. continue to grow.
  • Australia has deep economic, political and security connections with the ASEAN and a strategic partnership with one of the leading non-aligned nations, Indonesia.Both nations can leverage their equation with ASEAN to contain China.
  • Economic and Maritime dynamics in the Indo-Pacific: The Indo-Pacific region has the potential to facilitate connectivity and trade between India and Australia.
  • Quad:Being geographically more proximate than the US, Japan, India and Australia can emerge as leading forces for the Quad.
  • Health and safe food as well the supply chains: The promise ofDTC-CPG (direct to consumer; consumer packaged goods) which could transform global supply chains.
  • International cooperation:
    • WHO’s handling of pandemic: India and 62 other countries have backed a draft resolution led by Australia and the EU to ‘identify the zoonotic source’ of Covid-19 and its ‘route of introduction’ to humans.
    • Australia supports India’s candidature in an expanded UN Security Council.
    • Both  India  and  Australia  are members of the Commonwealth, IORA, ASEAN Regional Forum, Asia Pacific Partnership on Climate and Clean Development and  have  participated  in  the  East  Asia  Summits.
    • Australia   is   an   important   player   in   APEC   and   supports   India’s membership of the organisation. In 2008, Australia became a n Observer in SAARC.
    • Both countries have also been cooperating as members of the Five Interested Parties (FIP) in the WTO context.

 

 

Concerns in Bilateral Relations:

 

  • Trade implications for India- India and Australia are “too far apart” to conclude the bilateral Comprehensive Economic Cooperation Agreement (CECA) in the near term.
  • Perception of Indo pacific- There is no coherent Indo pacific strategy as countries do not have one definitive vision for the region. It is largely seen as global construct to arrest China’s rise.
  • Australia’s Foreign Policy Issues: While Australia is dependent on USA for defence and security, its economy is largely dependent on China. In such a scenario, Australia cannot left China as India cannot address Australia’s all requirements.
  • Challenges for India’s economy: Australia’s investment in India is not improving due to compromises, an interfering bureaucracy, corruption etc.
  • India opted out from Regional Comprehensive Economic Partnership (RCEP). Among other things, India and Australia could not agree regarding market access over agriculture and dairy products.

 

Way Forward
  • In coming years, the overall relationship between India and Australia will continue to grow and has the potential to assume greater prominence.
  • The prospects for bilateral relationship are recognised in both countries as strategically useful, economically productive and aligned with each other’s new agenda.
  • The several commonalities and closely aligned values in principles of democracy, liberty, the rule of law, human rights, freedom of speech, free press and multiculturalism serve as a foundation for a closer co-operation, multifaceted interaction and enhancement of bilateral relationship.

Virtual Bilateral Summit 2020:

First ever virtual bilateral summit was held between India and Autralia.

Outcome:

Elevated the bilateral Strategic Partnership to Comprehensive Strategic Partnership.

Elevated the “2+2” engagement to the level of Foreign and Defence Ministers (from secretary level), where strategic discussions will be taking place every two years. India already has such mechanism with USA and Japan.

Mutual Logistics Support Agreement was signed.

Joint declaration on shared vision for Maritime Cooperation in the Indo- Pacific region.